Lancaster University-UPP Master Agreement

CONFORMED COPY
Second Amendment and Restatement

Deed
University of Lancaster
and
UPP (Lancaster) Limited
relating to a Master Agreement for the provision

leasing and surrender of leases and underleases and
maintenance of student accommodation at the
University of Lancaster and related Building Contracts
for the construction of such student accommodation
and detailing further agreement between the parties
5 June 2007
ABS\\LAN09.00003
CONTENTS
CLAUSE PAGE
1. DEFINITIONS AND INTERPRETATION ........................................................................ 1

2. AMENDMENTS TO THE REVISED MASTER AGREEMENT AND THE DEEDS OF VARIATION ... 3
3. THE COUNTY FIELD SUPPLEMENTAL LEASE ................................................................ 3
4. REVISED MASTER AGREEMENT OTHERWISE IN FULL FORCE ........................................ 3
5. THE CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999............................................ 3
6. MISCELLANEOUS ................................................................................................... 3
7. REFINANCING AND NEW FINANCING AGREEMENTS .................................................... 4
8. THE PHASE 4 BUILDING CONTRACT.......................................................................... 4
9. THE REPLACEMENT HARD FM CONTRACT................................................................... 4
10. BASE CASE FINANCIAL MODEL AND BASE CASE REQUIREMENTS.................................. 4
11. NO DELAY EVENTS OR BREACHES ............................................................................ 5
12. WORKS TO CONSTITUTE PART OF PHASE 4 WORKS.................................................... 5
13. PHASE 4 WORKS CUT-OFF DATE EXTENDED .............................................................. 5
14. PAYMENT MECHANISM AND INFRASTRUCTURE WORKS ............................................... 6
SCHEDULE ........................................................................................................................ 7
Further Revised Master Agreement ....................................................................................... 7
ANNEXURES
1. Building Contract Phase 4
2. Building Contract Warranty Phase 4
3. Replacement Hard FM Contract

THIS SECOND DEED OF AMENDMENT AND RESTATEMENT is made on 5 June 2007
BETWEEN:
(1) THE UNIVERSITY OF LANCASTER incorporated by Royal Charter whose principal office
is at University House, The University of Lancaster, Lancaster LA1 4YN (the "University")
(2) UPP (LANCASTER) LIMITED (No. 4440009) a limited company registered in England
and Wales whose registered office is at Weston House 4th Floor 246 High Holborn
London WC1V 7EX (the "Project Co");
RECITALS
(A) The University and Project Co entered into a Master Agreement dated 26 September 2003
relating to the provision leasing and surrender of leases and underleases and the
maintenance of student accommodation at the University of Lancaster (the "Original
Master Agreement")
(B) The Original Master Agreement was varied pursuant to an Amendment and Restatement
Deed dated 26 April 2006 (the "Revised Master Agreement")
(C) Pursuant to clause 52 of the Revised Master Agreement the University served a notice on
Project Co requesting it to seek finance for the Phase 4 Works
(D) It is the University's intention, following completion of the Phase 4 Works, to utilise those
elements of Phase 4 constructed for residential use solely for letting to students pursuant
to Student Residence Agreements, other than the en suite rooms within the horizontal
cluster at Grizedale which in addition to being used for lettings to Students may be used
for non-student lettings (but not for more than ten weeks per year)
(E) The Project Co has secured finance for the Phase 4 Works on terms acceptable to the
University which include a Refinancing of Phases 1-3
(F) The parties wish to record and to document variations to the Revised Master Agreement
and to the leases granted and the underleases to be granted pursuant to the Revised
Master Agreement to reflect the carrying out of the Phase 4 Works, variations to the
various leases and underleases and the agreement of the Parties to the terms of the
Refinancing of Phases 1-3 and the financing for the Phase 4 Works
THE PARTIES AGREE AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this deed unless the context otherwise requires:
"Amendments" means the additions variations deletions and amendments to the

Revised Master Agreement highlighted in the version of the Further Revised Master
Agreement contained in the schedule
"Base Case Phase 4 Financial Model" has the meaning given to it in clause 9.1
"Deed of Variation of Headleases" means the deed of variation of the SW Campus

Leases, the Long Term Leases and the Core Accommodation Headleases of even date
herewith and made between the University (1) and Project Co (2)
1
LONDON\JTH\4391456.01
"Deed of Variation of Underleases" means the deed of variation of the Short Term
Underleases, the Core Accommodation Underleases the SW Campus Lease and the Long
Term Underleases of even date herewith and made between the University (1) and Project
Co (2)
"Early Works" has the meaning given to it in the Early Works Appointment
"Early Works Appointment" means the agreement dated 27 March 2007 between the
Project Co (1) the Replacement Building Contractor (2) and the University (3) which
authorises the Replacement Building Contractor to carry out the Early Works subject to
the terms set out therein prior to Phase 4 Financial Close
"Further Revised Master Agreement" means the Revised Master Agreement as

amended pursuant to the provisions of this Deed a conformed copy of which is in the
Agreed Form
"New Financing Agreements" means all agreements with the New Lenders including
any security documentation and the New Lenders' Direct agreement in the Agreed Form
for the purpose of the Refinancing and which includes the New Secured Term Facilities
Agreement
"New Lenders" means Dexia Crédit Local, London Branch being the persons providing
senior debt finance and/or hedging arrangements to Project Co under the New Financing
Agreements
"New Lenders' Direct Agreement" means the agreement of even date herewith and
made between the University, the New Lenders and Holdco
"New Secured Term Facilities Agreement" means the agreement so titled dated 5
June 2007 and made between (amongst others) Project Co (1) Holdco (2) Dexia Credit
Local London Branch (3) Barclays Bank plc (4) Dexia Management Services Limited (5)
Dexia Credit Local, London Branch (6) and various financial institutions (7)
"Phase 4 Building Contract" means the building contract to be entered into in respect
of Phase 4 and made between Project Co (1) the Replacement Building Contractor (2)
annexed to this deed as annexure 1
"Phase 4 Building Contractor" means Norwest Holst Limited
"Phase 4 Building Contractor Warranty" means the warranty to be entered into

between the Phase 4 Building Contractor (1) and The University (2) annexed to this deed
as annexure 2
"Phase 4 Financial Close" means that all conditions precedent to the Refinancing have
been met
"Refinancing" means the refinancing of the Project including the provision of finance for
the construction of Phase 4 with the New Lenders in accordance with the terms of the New
Financing Agreements
"Replacement Hard FM Contract" means the Hard FM Contract to be entered into

between Project Co (1) and the Replacement Hard FM Contractor (2) in respect of the
Project Co Accommodation annexed to this agreement as annexure 3
"Replacement Hard FM Contractor" means UPP Residential Services Limited
1.2 Original Master Agreement Definitions
2
Unless the context otherwise requires or the same is otherwise redefined as part of the
Amendments any word expression reference or term used in this deed which is defined in
the Original Master Agreement shall have the same meaning when used herein as in the
Revised Master Agreement
1.3 Interpretation
(a) The provisions of clause 2 of the Revised Master Agreement shall be incorporated
into this deed and shall apply as if set out in full in this deed
(b) References in this deed to the "Master Agreement" shall be deemed to be

references to the Further Revised Master Agreement
1.4 Deemed to Take Effect
The Revised Master Agreement shall be deemed to have been amended in accordance
with this deed on and from the date of execution of this deed
2. AMENDMENTS TO THE REVISED MASTER AGREEMENT AND THE DEEDS OF

VARIATION
2.1 The parties agree that the Revised Master Agreement shall be varied by the Amendments
and by this Deed and the parties shall be bound by the Revised Master Agreement as
varied by the Amendments from the date of execution of this deed
2.2 The University and the Project Co shall cause a memorandum recording the fact that the
Revised Master Agreement has been varied to be endorsed on and securely annexed to
the original and any counterparts of the original Master Agreement
2.3 The University shall instruct its solicitors to prepare two conformed copies of the Further
Revised Master Agreement showing the Amendments and both parties shall sign the front
cover of the same as evidence that such conformed copy represents the Further Revised
Master Agreement
2.4 In consideration of the payment of by the Project Co to the University (receipt

of which is hereby acknowledged) the University has agreed to enter into the Deed of
Variation of Headleases with Project Co
2.5 The Parties have also agreed to enter into the Deed of Variation of Underleases
3. NOT USED
4. REVISED MASTER AGREEMENT OTHERWISE IN FULL FORCE
The parties agree that save as amended by the Amendments and by this Deed the
Revised Master Agreement remains in full force and effect in accordance with its terms
5. THE CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
The Contracts (Rights of Third Parties) Act 1999 shall not apply to this deed and unless
specifically herein provided no person other than the parties to this agreement and their
assigns shall have any rights under it nor shall it be enforceable by any person other than
the parties to it
6. MISCELLANEOUS
6.1 This deed may be executed in any number of counterparts and all those counterparts
taken together shall be deemed to constitute one and the same instrument
3
6.2 If any provision of this deed is held to be void, illegal or unenforceable in any jurisdiction
it will be deemed severable from the remaining provisions which will remain in full force
and effect
7. REFINANCING AND NEW FINANCING AGREEMENTS
7.1 The University hereby consents to the Refinancing and the New Financing Agreements and
has today entered into the New Lenders' Direct Agreement
7.2 The parties hereby agree that with effect from Phase 4 Financial Close any references in
the Further Revised Master Agreement to the Secured Term Facilities Agreement or
definitions contained therein shall be deemed to be a reference to the New Secured Term
Facilities Agreement and definitions contained therein and any references in the Further
Revised Master Agreement to the Financing Agreements or the definitions contained
therein shall be deemed to be a reference to the New Financing Agreements or definitions
contained therein and any references in the Further Revised Master Agreement or
definitions contained therein to the Senior Lenders Direct Agreement shall be deemed to
be a reference to the New Lenders' Direct Agreement or the definitions contained therein
(as appropriate)
8. THE PHASE 4 BUILDING CONTRACT
8.1 The University hereby consents to the appointment of the Phase 4 Building Contractor by
the Project Co on the terms of the Phase 4 Building Contract and in accordance with the
provisions of clause 23 of the Master Agreement
8.2 Project Co and the University acknowledge and agree that the provisions of clause 23 of
the Further Revised Master Agreement shall apply to the Phase 4 Building Contract
8.3 The Phase 4 Building Contractor has executed and provided to the University the Phase 4
Building Contractor Warranty
8.4 The parties hereby agree that with effect from Phase 4 Financial Close any reference to
Building Contractor or Building Contract in the Further Revised Master Agreement in so far
as it relates to the Phase 4 Works shall, where the context permits, be a reference to the
Phase 4 Building Contractor and/or the Phase 4 Building Contract
9. THE REPLACEMENT HARD FM CONTRACT
9.1 The University hereby consents to the appointment of the Replacement Hard FM
Contractor by the Project Co on the terms of the Replacement Hard FM Contract and in
accordance with the provisions of clause 23 of the Further Revised Master Agreement
9.2 Project Co and the University acknowledge and agree that the provisions of clause 23 of
the Further Revised Master Agreement shall apply to the Replacement Hard FM Contract
9.3 The parties hereby agree that with effect from Phase 4 Financial Close any reference to
Replacement Hard FM or Replacement Hard FM Contract in the Further Revised Master
Agreement shall, where the context permits, be a reference to the Replacement Hard FM
Contractor and/or the Replacement Hard FM Contract
10. BASE CASE FINANCIAL MODEL AND BASE CASE REQUIREMENTS
10.1 Project Co has prior to the date of this deed made the necessary amendments to the Base
Case Financial Model to reflect the following:-
(a) the Phase 4 Works;
4
(b) the Further Revised Master Agreement;
(c) the Refinancing
and such financial model which is attached to this Deed in the Agreed Form shall be the
Base Case Phase 4 Financial Model
10.2 Project Co shall deliver to the University on Phase 4 Financial Close two copies of the Base
Case Phase 4 Financial Model and the Operating Financial Model
10.3 The parties agree that with effect from Phase 4 Financial Close references in the Further
Revised Master Agreement to "Base Case Financial Model" shall be deemed to be
references to the Base Case Phase 4 Financial Model and references in the Further Revised
Master Agreement to "Operating Financial Model" shall be deemed to be references to the
Operating Financial Model as defined in the New Secured Term Facilities Agreement
11. NO DELAY EVENTS OR BREACHES
The parties agree that in relation to the carrying out of the Phase 4 Works and as at the
date of this deed in relation to the Early Works which have been carried out pursuant to
the Early Works Appointment no Delay Events have occurred and neither party is aware
as at the date of this deed (other than as set out in this deed) of any breach of the Master
Agreement
12. WORKS TO CONSTITUTE PART OF PHASE 4 WORKS
12.1 This agreement shall supersede and replace the Early Works Appointment and (without
prejudice to the generality of the foregoing) the Early Works performed under the Early
Works Appointment (including, for the avoidance of doubt, any valuation or certification of
completion of any parts of the Early Works made by the Employer's Agent) and any
payment made or instructions or directions given by the Project Co or the University
under the Early Works Appointment shall be deemed to have been and treated (as the
case may be) as having been carried out, made or given by the Project Co under this
agreement; and any Early Works which have not been completed shall form part of the
Phase 4 Works to be carried out under the Further Revised Master Agreement.
12.2 Project Co confirms that, as at the date of this Deed, neither it nor any Project Co Party is
aware of any matter outstanding under and/or arising out of the Early Works Appointment
which would constitute a breach by the University under this agreement or the Master
Agreement and/or would constitute a Compensation Event.
12.3 Where following such confirmation given by Project Co pursuant to clause 12.2 there are
such matters outstanding and/or arising under the Early Works Appointment which Project
Co or any Project Co Party was aware of or should reasonably have been aware of, then
such matters shall not be taken into account in determining whether a breach by the
University of any of its obligations under this agreement or the Further Revised Master
Agreement has occurred and/or a Compensation Event or a University Default has
occurred and Project Co shall not be entitled to terminate the Further Revised Master
Agreement as a result of such matters.
13. PHASE 4 WORKS CUT-OFF DATE EXTENDED
The University confirms and Project Co confirms its agreement that the Phase 4 Works
Cut-Off Date has been deferred until 30 November 2007 due to the application of clause
52.8 of the Further Revised Master Agreement
5
14. COUNTERPARTS
This Agreement may be executed by any number of Counterparts and provided that every
party has executed a counterpart, the counterparts together shall constitute a binding and
enforceable agreement between the parties
IN WITNESS whereof this deed has been executed on the date first above written
6
SCHEDULE
Further Revised Master Agreement
The amendments shown in the draft of the Further Revised Master Agreement attached to this
schedule
7
The common seal of THE UNIVERSITY )
OF LANCASTER was hereunto affixed in )
the presence of: )
Member of Council
University Secretary
The common seal of UPP )

(LANCASTER) LIMITED was hereunto )
affixed in the presence of: )
Authorised Signatory
Authorised Signatory
8
CONTENTS
CLAUSE PAGE
DEFINITIONS AND CONSTRUCTION........................................................................................... 1

1. DEFINITIONS................................................................................................................... 1
2. CONSTRUCTION AND INTERPRETATION...........................................................7783
3. DURATION ..................................................................................................................7985
Part 1 - Grant of the Leases and Underleases .................................................................................8086
4. GRANT OF SW CAMPUS LEASES...........................................................................8086
5. GRANT OF SW CAMPUS UNDERLEASES .............................................................8086
6. GRANT OF THE LONG TERM LEASES AND THE CORE ACCOMMODATION
UNDERLEASES ...................................................................................................80HEADLEASES
86
7. GRANT OF SHORT TERM UNDERLEASES...........................................................8187
8. SURRENDER OF SHORT TERM UNDERLEASES AND PART OF LONG TERM
LEASES......................................................................................................................................8187
9. GRANT OF THE LONG TERM UNDERLEASES AND THE CORE
ACCOMMODATION UNDERLEASES ..................................................................................8187
10. CONDITIONS ..............................................................................................................8288
11. TITLE ...........................................................................................................................8289
12. MATTERS AFFECTING THE PREMISES...............................................................8290
13. PRELIMINARY ANSWERS .......................................................................................8390
14. ENGROSSMENTS.......................................................................................................8391
15. STANDARD COMMERCIAL PROPERTY CONDITIONS .....................................8491
16. PAYMENT OF THE PREMIUM 84 AND WORKS PAYMENT ................................. 92
17. GROUND RENT ..........................................................................................................8492
18. THE UNIVERSITY ACCOMMODATION CHARGE ..............................................8492
19. VACATION INCOME.................................................................................................8492
Part 2 - Planning............................................................................................................................8593
20. SATISFACTION OF RESERVED MATTERS AND PARTIES OBLIGATIONS IN
RELATION TO PLANNING CONDITIONS...........................................................................8593
Part 3 - The Operating Financial Model .........................................................................................8896
21. FINANCIAL MODEL..................................................................................................8896
Part 4 - General Performance Obligations and Co-operation ..........................................................8997
22. GENERAL PERFORMANCE STANDARDS OF PROJECT CO.............................8997
23. SUB-CONTRACTS AND ANCILLARY DOCUMENTS ...........................................8997
24. CO-OPERATION.........................................................................................................9199
25. CONFIDENTIALITY ................................................................................................92100
26. REPUTATION OF THE UNIVERSITY ...................................................................93102
27. PROHIBITION ON DIVERSIFICATION................................................................93102
Part 5 - The Development Phase..................................................................................................94103
28. CARE OF THE WORKS, REINSTATEMENT AND REPAIR...............................94103
29. SITE CONDITIONS AND UTILITIES.....................................................................95104
30. CDM REGULATIONS ..............................................................................................97108
31. ANTIQUITIES ...........................................................................................................99110
32. DESIGN AND CONSTRUCTION OF THE WORKS............................................100111
33. DESIGN DEVELOPMENT .....................................................................................102113
34. EXTENSIONS OF TIME.........................................................................................106117
35. ALTERNATIVE ACCOMMODATION .................................................................107118
36. TESTS ON COMPLETION.....................................................................................111123
37. WORKS COMPLETION CERTIFICATES ...........................................................111123
38. SNAGGING MATTERS ..........................................................................................113125
ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster

39. UNIVERSITY OPERATIONS.................................................................................115127
40. COLLATERAL WARRANTIES.............................................................................115127
41. RELIEF EVENTS ....................................................................................................115127
42. COMPENSATION EVENTS...................................................................................116128
43. INFRASTRUCTURE ...............................................................................................119131
Part 6 – Assignment, Change of Control and Change of Lenders ...............................................123135
44. ASSIGNMENT .........................................................................................................123135
45. DEALING IN SHARES AND CHANGE OF LENDERS .......................................126139
Part 7 – Refinancing..................................................................................................................129141
46. REFINANCING .......................................................................................................129141
Part 8 - Variations and Change in Legislation ............................................................................133145
47. VARIATIONS ..........................................................................................................133145
48. CHANGES IN LEGISLATION ...............................................................................133145
Part 9 - Default and Termination of the Primary Period Arrangements .......................................134146
49. TERMINATION OF THE PRIMARY PERIOD ARRANGEMENTS ..................134146
50. EFFECTS OF TERMINATION OF THE PRIMARY PERIOD ARRANGEMENTS
140 OR THE SECONDARY PERIOD (NON DEFAULT) ARRANGEMENTS...................... 154
51. CONSEQUENCES OF TERMINATION................................................................141154
Part 10 – Phase 4 Works...................................................................................................143Not Used 158
52. PHASE 4 WORKS ARRANGEMENTS .............................................................................. 143
52. NOT USED .................................................................................................................... 158
Part 11 - Insurance ....................................................................................................................148159
53. INSURANCE OBLIGATIONS IN RELATION TO THE ACCOMMODATION 148159
54. INSURANCE ACCOUNT........................................................................................149160
55. INSURANCE PROCEEDS ......................................................................................149160
56. ECONOMIC REINSTATEMENT TEST................................................................150161
57. REINSTATEMENT .................................................................................................152163
58. UNINSURABLE RISKS...........................................................................................154165
59. NOT USED ...............................................................................................................154165
60. UNIVERSITY'S INSURANCE OBLIGATIONS IN RELATION TO THE
UNIVERSITY RESIDENTIAL ACCOMMODATION .......................................................154166
61. APPLICATION OF INSURANCE PROCEEDS IN RELATION TO THE
UNIVERSITY RESIDENTIAL ACCOMMODATION .......................................................155167
62. UNIVERSITY RESIDENTIAL ACCOMMODATION REINSTATEMENT TEST
156167
63. REINSTATEMENT OF UNIVERSITY RESIDENTIAL ACCOMMODATION .156168
64. APPLICATION OF BUSINESS INTERRUPTION PROCEEDS ..........................157168
65. UNINSURABLE RISKS IN RELATION TO THE UNIVERSITY RESIDENTIAL
ACCOMMODATION............................................................................................................157169
Part 12 - The University Residential Accommodation................................................................159171
66. UNIVERSITY RESIDENTIAL ACCOMMODATION..........................................159171
67. RESTRICTIVE COVENANT..................................................................................162174
Part 13 - The Operational Phase ................................................................................................164177
68. PROVISION OF SERVICES...................................................................................164177
69. ALLOCATION OF ROOMS ...................................................................................164177
Part 14 – Miscellaneous Provisions ...........................................................................................165178
70. AGENCY ..................................................................................................................165178
71. WAIVER...................................................................................................................166179
72. COUNTERPARTS ...................................................................................................166179
73. SEVERABILITY......................................................................................................166179
74. WARRANTIES AND DISCLAIMERS ...................................................................166179
75. LIAISON AND DISPUTES RESOLUTION ...........................................................167180
76. ADVISERS AND REPRESENTATIVES ................................................................167180
77. QUALITY ASSURANCE.........................................................................................168181
78. NOTICES..................................................................................................................170183

79. CONSENTS AND APPROVALS.............................................................................172185
80. VAT..........................................................................................................................172185
81. ENTIRE AGREEMENT ..........................................................................................175189
82. SURVIVAL...............................................................................................................175189
83. INTEREST ON LATE PAYMENT .........................................................................175189
84. THIRD PARTY RIGHTS ........................................................................................176189
85. GOVERNING LAW AND JURISDICTION...........................................................176189
86. SET OFF ...................................................................................................................176190
87. EXCLUSIVE REMEDIES .......................................................................................176190
88. NO AVOIDANCE OF LIABILITY .........................................................................177191
89. EXEMPT CHARITY .................................................................................................... 191
SCHEDULE 1...........................................................................................................................179192
Design Development Procedure.................................................................................................179192
Part 1 - General Design Development........................................................................................179192
SCHEDULE 2...........................................................................................................................184197
PROJECT PROCEDURES MANUAL......................................................................................184197
Project Procedures.....................................................................................................................184197
SCHEDULE 3...........................................................................................................................197210
Tests on Completion..................................................................................................................197210
CONTENTS .............................................................................................................................200213
SCHEDULE 4...........................................................................................................................216229
Required Periods .......................................................................................................................216229
SCHEDULE 5...........................................................................................................................217230
Access Routes ...........................................................................................................................217230
SCHEDULE 6...........................................................................................................................218231
Collateral Warranties.................................................................................................................218231
SCHEDULE 7...........................................................................................................................243256
Not Used...................................................................................................................................243256
SCHEDULE 8...........................................................................................................................244257
Project Co's Proposals ...............................................................................................................244257
SCHEDULE 9...........................................................................................................................245258
Rate of Rental Discount.............................................................................................................245258
SCHEDULE 10.........................................................................................................................246259
Infrastructure Works .................................................................................................................246259
SCHEDULE 11.........................................................................................................................247260
Part 1 - The Services .................................................................................................................247260
Part 2 – Benchmarking and Market Testing of the Services 256 and the Soft FM Services ............ 270
Part 3 - The Soft FM Services....................................................................................................261275
Part 4 - General Provisions ........................................................................................................264278
SCHEDULE 12.........................................................................................................................267281
Administration Arrangements and Allocations Policy ................................................................267281
SCHEDULE 13.........................................................................................................................277291
The University Accommodation Charge and Performance Measurement System .......................277291
Part 1 – Calculation of the University Accommodation Charge..................................................277291
Part 2 – Calculation of Availability and Performance Deductions ..............................................289305
Part 3 - Monitoring of Performance and Availability..................................................................292308
Part 4 – Availability and Calculation of Availability Deductions................................................298314
Part 5 - Performance Measurement and Calculation of Service Deductions ...............................304320
Part 6 - Limits on Service Deductions........................................................................................311327
SCHEDULE 14.........................................................................................................................334352
Ground Rent..............................................................................................................................334352
SCHEDULE 15.........................................................................................................................340358
Conference Vacation Lettings....................................................................................................340358
SCHEDULE 16.........................................................................................................................346364
Variations .................................................................................................................................346364

Part 1 - Variations Generally .....................................................................................................346364
Part 2 - Infrastructure Variation .................................................................................................357375
SCHEDULE 17.........................................................................................................................359377
Change in Legislation................................................................................................................359377
SCHEDULE 18.........................................................................................................................365383
Insurances .................................................................................................................................365383
Part 1 - Pre-Operation Period Insurances............................................................................365383
Part 2 - Operational Term Insurances ..................................................................................372389
Part 3 University Required Insurance ........................................................................................... 378
SCHEDULE 19.........................................................................................................................381399
Documents To Be Delivered By Project Co ...............................................................................381399
SCHEDULE 20.........................................................................................................................384402
Rental Payments following a termination of the Primary Period Arrangements 384 and/or the
Secondary Period (Non Default) Arrangements.......................................................................... 402
Part A........................................................................................................................................384402
Part B........................................................................................................................................387406
Termination of the Primary Period Arrangements – ...................................................................387406
Payments following a Termination for an Event of Project Co Default.......................................387406
Part C – Payments following a Termination of the Primary Period Arrangements for an Obligatory
Major Disposal or an Obligatory Merger which does not meet specified tests, a Change in Legislation
(including a VAT Change in Legislation), an Uninsurable Risk or Force Majeure......................390409
Part D – Payments following a Termination of Primary Period Arrangements – Prohibited Acts 392413
Part E - General.........................................................................................................................394415
Part G ........................................................................................................................................... 428
Termination of the Secondary Period Arrangements – .............................................................. 428
Payments following a Termination for an Event of Project Co Default ..................................... 428
SCHEDULE 21.........................................................................................................................405430
Indemnities ...............................................................................................................................405430
SCHEDULE 22.........................................................................................................................410435
Liaison Procedures and Disputes Resolution Procedure .............................................................410435
Part 1 - Liaison Procedure .........................................................................................................410435
Part 2 - Disputes Resolution Procedure......................................................................................411436
Part 3 - Expert Determination ....................................................................................................417442
SCHEDULE 23.........................................................................................................................422447
List of Project Documents .........................................................................................................422447
SCHEDULE 24.........................................................................................................................424449
Warranties and TUPE................................................................................................................424449
SCHEDULE 25.........................................................................................................................429454
University Residential Accommodation.....................................................................................429454
SCHEDULE 26.........................................................................................................................430455
Modelled Rental Income and Ground Rent ................................................................................430455
SCHEDULE 27.........................................................................................................................431456
Annexures
Annexure 1 – Construction and Phasing Plans
Annexure 2 – Shepherd Hunter Epstein Plan of Lancaster University Campus
Annexure 3 – Outline Forward Maintenance Schedule
Annexure 4 – Output Specification
Annexure 5 – Soft FM Services and Soft FM Service Levels
Annexure 6 – Form of Student Residence Agreement
Annexure 7 – University's Development Programme
Annexure 8 – Drawing No. 1JC1/055 Rev.B showing the SW Campus Works

Annexure 9 - Output Brief
Annexure 10 – Phase 4 Surveys
Agreed Form Documents

1. Base Case Financial Model
2. Building Contract
3. Building Contract Guarantee
4. Cartmel Lease
5. Cartmel Short Term Underlease
6. Cartmel Underlease
7. Closing Statement
8. Core Accommodation Headleases
9. Core Accommodation Underleases
10. Phase 1 Lease Not used
11. Phase 1 Underlease
12. Phase 2 Lease
13. Phase 2 Underleases
14. Deeds of Surrender Long Term Leases
15. County Lease
16. County Short Term Underlease
17. County Underlease
18. Employer's Agent's Appointment
18A. Employer's Agent's Appointment Phase 4
19. Finance Agreements
19A. Finance Agreements Phase 4
20. Furness Lease
21. Furness Short Term Underlease
22. Furness Underlease
23. Fylde Lease
24. Fylde Short Term Underlease

25. Fylde Underlease
26. Grizedale Lease
27. Grizedale Short Term Underlease
28. Grizedale Underlease
29. Hard FM Contract
30. Hard FM Contract Guarantee
31. Request Notice
32. Room Reduction Notice
33. Design Development Programme
34. Construction Programme
35. Project Co Proposals
36. Income, Expenditure and Occupancy Statement
37. Base Case Phase 4 Financial ModelNot used
38. Infrastructure Works
39. Schedule of Modelled Rental Income and Ground Rent
40. Schedule of Annualised Operating Costs and Project Co Operating

Costs (forming part of Base Case Financial Model and shown as
Worksheet MA Def)
41. Deed of Variation of Phase 1 Headlease
42. Deed of Surrender (Phase 1 Headlease) Part
43. Supplemental Lease
44. Deed of Variation of the Leases
45. Deed of Variation of the Underleases
46. Deed of Surrender of Short Term Underleases
47. County Field Supplemental Lease
48. County Field Supplemental Underlease

THIS AGREEMENT is made on 26th September 2003
BETWEEN:
(1) THE UNIVERSITY OF LANCASTER incorporated by Royal Charter whose principal

office is at University House The University of Lancaster LA1 4YW (the "University"); and
(2) UPP (LANCASTER) LIMITED (No. 4440009) a limited company registered in England
and Wales whose registered office is at Frogmore Park Watton at Stone Hertfordshire SG14
3RU ("Project Co").
RECITAL:
(A) By a notice published in the Official Journal of the European Communities dated 31.08.2001
ref. no. 2001/S 173-119505, the University invited expressions of interest from appropriately
qualified consortia for the provision of student accommodation.
(B) The Shareholders form the consortium chosen by the University. The Shareholders are the
shareholders in Holdco. Project Co is a wholly owned subsidiary of Holdco.
(C) The Parties have now agreed the terms on which Project Co will design, construct, lease and
maintain student accommodation at the Site.
(D) The Parties have entered into each of the Project Documents (as defined below) including this
Agreement contemporaneously.
(E) This Agreement is the Master Agreement and the remainder of the Project Documents are
supplemental to this Agreement.
(G) The Parties wish the Project Documents to be interpreted in accordance with this Agreement.
DEFINITIONS AND CONSTRUCTION
1. DEFINITIONS
In the Project Documents (including the recitals and Schedules), the following terms shall,
unless the context otherwise requires, have the following meanings:
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"Access Routes" means those areas on the Adjoining Land required to carry out any of the
Works as described at Schedule 5 and all estate roads on the Adjoining Land leading to and
from the Site to the public highway;
"ACRY-2" means the Residence Year immediately preceding the Applicable Preceding
Residence Year;
"Aggregate Undergraduate Home Students" or "AUHS" means (for the Applicable

Current Residence Year) the number of home undergraduate Attending Students calculated as
follows:
AUHS = AS1 (H) + AS2 (H) + AS3 (H)
"AS1 (H)" means (for the Applicable Current Residence Year) the number of First Year
undergraduate Attending Students who have the same address in both home and term time (as
indicated in the University's records);
"AS2 (H)" means (for the Applicable Current Residence Year) the product of the following
calculation:
AS2 (H) = AS2 × Y%
"Y" means (for the Applicable Current Residence Year) a discount figure equal to the number
of First Year Attending Students who had the same address in both home and term time (as
indicated in the University's records) for the Applicable Preceding Residence Year expressed
as a percentage of the number of First Year Attending Students for the Applicable Preceding
Residence Year;
"AS3 (H)" means (for the Applicable Current Residence Year) the product of the following
calculation:
AS3 (H) = AS3 × Z%
"Z" means (for the Applicable Current Residence Year) a discount figure equal to the number
of First Year Attending Students who had the same address in both home and term time (as
indicated in the University's records) for ACRY-2 expressed as a percentage of the number of
First Year Attending Students for ACRY-2;
-2-
"First Year Attending Students" or "AS1" means (for the Applicable Current Residence
Year) an undergraduate Attending Student in the first year of his/her study at the University;
"Second Year Attending Students" or "AS2" means (for the Applicable Current Residence
Year) an undergraduate Attending Student in the second year of his/her study at the
University;
"Third Year Attending Students" or "AS3" means (for the Applicable Current Residence
Year) an undergraduate Attending Student in the third year of his/her study at the University;
"Attending Student Level" means (for the Applicable Current Residence Year) the
aggregate of:
(i) the total number of undergraduate Attending Students less AUHS ; and
(ii) the total number of postgraduate Attending Students less APHS
and such total shall take proper account of all Attending Students beginning their year of study
part way through a Residence Year;
"Aggregate Postgraduate Home Students" or "APHS" means (for the Applicable Current
Residence Year) the number of home postgraduate Attending Students calculated as follows:
APHS = APS1 (H) + APS2 (H) + APS3 (H)
"APS1 (H)" means (for the Applicable Current Residence Year) the number of postgraduate
Attending Students who have the same address in both home and term time (as indicated in
the University's records);
"APS2 (H)" means (for the Applicable Current Residence Year) the product of the following
calculation:
APS2 (H) = APS2 × T%
"T" means (for the Applicable Current Residence Year) a discount figure equal to the number
of First Year Postgraduate Students who had the same address in both home and term time (as
indicated in the University's records) for the Applicable Preceding Residence Year expressed
as a percentage of the number of First Year Postgraduate Students for the Applicable
Preceding Residence Year;
-3-
"APS3 (H)" means (for the Applicable Current Residence Year) the product of the following
calculation:
APS3 (H) = APS3 × W%
"W" means (for the Applicable Current Residence Year) a discount figure equal to the
number of First Year Postgraduate Students who had the same address in both home and term
time (as indicated in the University's records) for ACRY-2 expressed as a percentage of the
number of First Year Postgraduate Students for ACRY-2;
"First Year Postgraduate Students" or "APS1" means (for the Applicable Current
Residence Year) a postgraduate Attending Student in the first year of his/her postgraduate
study at the University;
"Second Year Postgraduate Students" or "APS2" means (for the Applicable Current
Residence Year) a postgraduate Attending Student in the second year of his/her postgraduate
"Third Year Postgraduate Students" or "APS3" means (for the Applicable Current
Residence Year) a postgraduate Attending Student in the third year of his/her postgraduate
"Acceptable Current Credit Rating" means a medium term senior debt rating not lower
than BBB in respect of S&P and Baa3 in respect of Moody's and dated not less than 6 months
prior to the date of the Request Notice and which S&P or Moody's (as applicable) confirm in
writing is currently valid as at the RC Test Date;
"Accommodation" means the Existing Accommodation and the Project Co Accommodation;
"Account Bank" has the meaning given to that expression in the Accounts Agreement;
"Accounts Agreement" has the meaning given to that expression in the Secured Term
Facilities Agreement;
"Academic Space" means that part of the first floor of County Main which following the
completion of the Phase 4 Works will be utilised for academic use by the University as
more particularly shown on the Construction and Phasing Plans;
-4-
"Actual Insurance Cost" means the actual cost reasonably and properly incurred by Project
Co in maintaining the insurances for the Accommodation pursuant to the provisions of this
Agreement for the relevant Residence Year;
"Actual Rental Income" or "ARI" means the total Income receivable by the University in
respect of the Accommodation for the relevant Residence Year;
"Added Room Factor" means the product of (a) × (b), where (a) is 0.55 and (b) is the
aggregate number of Rooms which at any time on and from the date of this Agreement and up
to the applicable RC Test Date have been removed by the University from the Campus
Accommodation but for these purposes shall not include any Rooms removed from County
and Grizedale and the Grizedale 20 Rooms;
"Additional Service" means any new service that the University requests Project Co to
provide or procure the provision of (pursuant to Schedule 16 (Variations)) of this Agreement
that is not at the date of such request an existing Service and, having regard to the nature of
which, cannot reasonably be regarded to be a Variation of an existing Service;
"Adjoining Land" means any land or premises neighbouring or adjoining the Site, the
Construction Site or the Premises now or at any time during the Term belonging to the
University;
"Adjudicator" means the person appointed or to be appointed as an adjudicator pursuant to

paragraph 4.2 of part 2 of Schedule 22 (Liaison and Disputes Resolution Procedure) and
"Adjudication" shall be construed accordingly;
"Adjusted Room Total" means the aggregate of (1) the Running Room Total and (2) the
number of Proposed Further Rooms;
"Adverse Reputational Effect" means that either the academic standing of the University or
the reputation of the University both academically and/or among its Students (such that
Students would choose not to attend courses of study or research at the University) will be
materially and adversely affected;
"Aggregate Attending Student Level" means (in aggregate) the Attending Student Level for
each Historic Test Period Year in the Historic Test Period;
"Aggregate Historic Rental Income" means the Relevant Aggregate Net Rental Income
Amounts for the Historic Test Period;
-5-
"Aggregate Historic Room Availability" means the aggregate of the Running Room Totals
for each Historic Test Period Year in the Historic Test Period;
"Aggregate Modelled Rental Income" means the Income modelled to be receivable for the
Applicable Current Residence Year (RPI Indexed) as shown in the Base Case Financial Model
Worksheet Ma Def Row 10 and Schedule 27 as the same may be adjusted pursuant to the
provisions of this Agreement;
"Agreed Work-Out Period" has the meaning given to that expression in the Senior Lenders'
Direct Agreement;
"Agreement" means this Agreement and the Schedules and Appendices hereto;
"Alma Mater Group" means
(a) 3i Investments GP Limited and Barclays Alma Mater General Partner Limited
and any company which is a subsidiary of either, any holding company of 3i
Investments GP Limited or Barclays Alma Mater General Partner Limited or a
subsidiary of such holding company; and
(b) any unit trust, investment fund, partnership or other fund including any
investor or potential investor therein or other entity of which any entity referred
to in paragraph (a) of this definition is the general partner, trustee, principal,
manager or co-manager (either directly or indirectly) and including without
limitation Alma Mater, the Barclays European Infrastructure Fund Limited
Partnership and the Barclays European Infrastructure Fund II Limited
Partnership; and
(c) any nominee or trustee of any entity falling within paragraphs (a) or (b) of this
definition acting in such capacity (whether in a change of nominee or trustee or
otherwise)
"Allocation Information" has the meaning given in paragraph 3.2 of Schedule 12

(Administration Arrangements and Allocations Policy) of this Agreement;
"Allocations Policy" means the methodology for allocating Students to residences (including
the Accommodation) and for the subsequent entry by the University into Student Residence
-6-
Agreements as set out in Schedule 12 (Administration Arrangements and Allocation Policy)
of this Agreement;
"Allocation Report" has the meaning given in paragraph 3.1 of Schedule 12 (Administration
Arrangements and Allocation Policy) of this Agreement;
"Annualised Operating Costs" means the costs shown in the Base Case Financial Model
Worksheet MA Def Row 12 for the provision of the Services for each Residence Year during
the Term (RPI Indexed) as adjusted pursuant to the provisions of the Project Documents such
costs as at the Phase 4 Effective Date being those set out in Schedule 27;
"Apartment" means an apartment within a Block comprising a number of rooms and a

Kitchen Area and other common areas;
"Applicable Build-Out Demand Ratio" has the meaning given to that expression in Clause
67.4.2;
"Applicable Current Residence Year" means the then current Residence Year;
"Applicable Historic Demand Ratio" has the meaning given to that expression in Clause
67.4.1;
"Applicable Maintenance Regime" means the Core Accommodation Maintenance Regime

for the Core Accommodation and the Non-Core Accommodation Maintenance Regime for the
Non-Core Accommodation;
"Applicable Preceding Residence Year" means the Residence Year immediately preceding
the Applicable Current Residence Year;
"Applicable Termination Sum" has the meaning given to that expression in Part F of
Schedule 20 (Rental Payments following a termination of the Primary Period Arrangements);
"Applicable Tests" means each of the tests specified in Clause 67.4;
"Approved Credit Rating" means a medium term senior debt rating for the University
(current at the Notification Date) issued by S&P or Moody's which takes into account the
impact of the Transaction and confirms that this will have no adverse effect on the rating of
the University compared to the circumstance in which the Transaction does not take place and
is disregarded;
-7-
"Attending Student" means (for the Applicable Current Residence Year) any full time
Student registered for programmes leading to the award of a higher education qualification at
the University;
"Attending Student Level Floor" means (for the Applicable Current Residence Year) the
Base Case Attending Student Level PROVIDED THAT if the Attending Student Level as at
the Notification Date is less than the Base Case Attending Student Level then that Attending
Student Level shall constitute the Attending Student Level Floor for the purposes of this
definition;
"Attending Student Level Floor (Phase 4)" means 8,408;
"Audit Material" has the meaning given to it in paragraph 1.4 of Part 3 of Schedule 13 (the
University Accommodation Charge and Performance Measurement System) of this
Agreement;
"Authorised Representative" has the meaning given to it at paragraph 3.2 in part 2 of

Schedule 22 (Liaison and Disputes Resolution) of this Agreement;
"Availability Criteria" means :
(a) in relation to any Room in the Project Co Accommodation:
(ai) it is in good structural and physical order and watertight;
(bii) reasonable and adequate access and egress is available including (where a
Room is not at ground floor level and in respect of the Academic Space)
lifts or other appropriate means of vertical transportation are in working order
following the expiration of two weeks following the NCI relating to such
element;
(ciii) all Legislation relating to access or egress or occupation or use is complied

with in full;
(div) all health and safety legislation and regulations are complied with in full;
(ev) it contains the Essential Fixtures Fittings and Equipment;
-8-
(fvi) there is an uninterrupted supply of power, electricity (including small power)
gas electricity water drainage and other utilities within the curtilage of the
relevant Building;
(gvii) the temperature is not less than 18°C;
(hviii) the lighting levels are greater than 150 lux at desk height and in all other
respects will comply with CIBSE and all other requirements in relation to
health and safety applicable at the time and have suitable and sufficient
lighting to allow safe and healthy working free from limiting glare flicker or
other adverse influence and suitable for the task carried out; and
(b) in relation to each of the Retail Space, the Social Space and the Academic Space:
(i) it is in good structural and physical order and watertight;
(ii) reasonable and adequate access and egress is available including in

respect of the Academic Space lifts or other appropriate means of
vertical transportation are in working order following the expiration of
two weeks following the NCI relating to such element;
(iii) all Legislation relating to access or egress or occupation or use is

complied with in full;
(iv) all health and safety legislation and regulations are complied with in full;
(v) there is an uninterrupted supply of power, electricity (including small

power) gas electricity water drainage and other utilities within the
curtilage of the relevant Building;
(vi) the temperature is not less than 18°C;
"Availability Deductions" means the deductions which the University is entitled to make
from the University Accommodation Charge for Unavailability calculated in accordance with
Part 4 of Schedule 13 (the University Accommodation Charge and Performance Measurement
System) of this Agreement;
"Availability Mandatory Elements" means the required presence in the Rooms, Ensuite
Bathrooms and Kitchen Areas in the Project Co Accommodation, of such items as are
-9-
specified in Appendix 3 to Schedule 13 (the University Accommodation Charge and
Performance Measurement System) of this Agreement;
"Available for Letting" means at the relevant time in respect of any Room in the Project Co
Accommodation that it is vacant not the subject of a Student Residence Agreement or
Vacation Use Agreement that it meets all the Availability Criteria the Ensuite Bathroom
contains all Availability Mandatory Elements and Essential Fixtures Fittings and Equipment
and the Apartment in which the Room is situated has a Kitchen Area which contains all of the
Availability Mandatory Elements and the Essential Fixtures Fittings and Equipment;
"Average Total Annual Debt Service Cover Ratio" has the meaning given to that
expression in the Secured Term Facilities Agreement;
"Base Case Attending Student Level" means (for the Applicable Current Residence Year)
7,851 Attending Students;
"Base Case Financial Model" has the meaning given to that expression in the Secured Term
"Base Case Historic Rental Income" means the Aggregate Modelled Rental Income for the
Historic Test Period;
"Base Case Phase 4 Financial Model" means the financial model in the Agreed Form which
assumes the financing of Phase 4 proceeds;
"Base Case Rental Income (Phase 4)" means the Aggregate Modelled Rental Income for the
applicable Historic Test Period Year;
"Base Rent" means, in respect of each Headlease, an annual rent of

payable in equal instalments on each Payment Date;
"Base Case Requirements" means (without double counting):
(a) during that part of the Primary Period prior to the date which is the earlier of (1) the
Phase 3 Works Completion Date and (2) the First Term Loan Repayment Date (in
relation to the Applicable Current Residence Year) the forecast amount required by
Project Co in order to meet the aggregate of:
(i) the Project Co Insurance Premia;
- 10 -
(ii) the Annualised Operating Costs;
(iii) the Project Co Operating Costs;
(iv) the Sinking Fund Contribution; and
(iv) (a) Tax; and
(v) that part of the Construction Costs as shown in the Base Case Financial
Model Worksheet MA Def Row 17 and Schedule 27 for the Applicable
Current Residence Year which is being met from Project Co Accommodation
Net Income (but only to the extent that the payment certification provisions
of Clause 4.3.10 of the Secured Term Facilities Agreement have been met);
(b) during that part of the Primary Period from and including the earlier of (1) the Phase 3
Works Completion4 Effective Date and (2) the First Term Loan Repayment Date (in
relation to the Applicable Current Residence Year) the forecast amount required by
Project Co in order to meet the aggregate of:
(i) the Project Co Insurance Premia;
(ii) the Annualised Operating Costs;
(iii) the Project Co Operating Costs;
(iv) the Sinking Fund Contribution;
(iv) (a) Tax; and
all as adjusted to reflect any Cost Change pursuant to the provisions of this
Agreement including paragraph 10 of Part 1 of Schedule 13
(v) Debt Service; and
(vi) Equity Top Up Sums
(c) during any period where the Secondary Period Work-Out Arrangements or
the University DefaultTriggered Work -Out Arrangements have come into effect
- 11 -
pursuant to the provisions of the Senior Lenders' Direct Agreement (in relation to the
Applicable Current Residence Year) the forecast amount required by Project Co or
the Appointed Representative (as appropriate) in order to meet all Operating Costs
and pay Work-Out Debt Service
(d) during any part of the Primary Period after the date when Senior Debt Sums
have been repaid and during any period where the Secondary Period (Non
Default) Arrangements apply the Project Co Accommodation Net Income;
"Benchmarking Date" means 1 September 2014 and each fifth anniversary of such date
thereafter;
"Block" means a block of accommodation with a shared entrance serving groups of

Apartments to be constructed as part of the Works as identified as a Block (including the
services link to serve that Block) as shown in the drawings attached to the Project Co's
Proposals;
"Block 34" means the Block so identified on the Construction and Phasing Plans
"Blocked Distribution Account" has the meaning given to that expression in the Secured
Term Facilities Agreement;
"Blocked URA Rental Distribution Account" or "BURDA" has the meaning given to that
expression in Clause 13 of the Senior Lenders' Direct Agreement;
"Blue Collar Services" has the meaning set out in paragraph 1.1 of Part 2 of Schedule 11
(Services);
"Bradford and Bingley Loan" means the loan facility entered into by the University with
Bradford and Bingley Building Society reference no 401086 on or about September 1998 and
as the same may be varied or amended from time to time;
"Building" means any building or buildings forming part of the Accommodation;
"Building Contract" means the agreement so titled made on or about the Effective Date
between (1) Project Co and (2) the Building Contractor for the design, construction and
completion of the Works such agreement to be in the Agreed Form and all ancillary
documents thereto together with any replacement building contract entered into in accordance
with the provisions of this Agreement;
- 12 -
"Building Contract Performance Bond" means the performance bond to be given by St
Paul International Insurance Company Limited insurance company in the form attached to the
Building Contract;
"Building Contract Guarantee" means the guarantee to be procured by the Building

Contractor in favour of Project Co in the Agreed Form pursuant to the terms of the Building
Contract;
"Building Contractor" means the building contractor referred to in Clause 23.1.1 of this
Agreement or such substitute as may be appointed by Project Co for the time being pursuant
to a replacement of the Building Contract in accordance with the provisions of this
Agreement;
"Building Contractor Guarantor" means the guarantor under the Building Contract
Guarantee;
"Building Contractor's Deed of Warranty" means the form of warranty from the Building
Contractor to the University in the form attached at Schedule 6;
"Build-Out Demand Ratio" means (as at the applicable RC Test Date) (x) one third of the
Aggregate Attending Student Level divided by (Y) the Adjusted Room Total;
"Calculation" means the computations set out in the Calculation Notice;
"Calculation Notice" means the written statement to be supplied to the University by Project
Co with its calculation as to the Relevant Required Rent for the Applicable Current Residence
Year in accordance with the provisions of paragraph 4 of Part 1 of Schedule 13;
"Campus Accommodation" means the Accommodation and the University Residential

Accommodation;
"CAPEX Change in Legislation" means a Change in Legislation not being a Foreseeable

Change in Legislation that has the effect of requiring Project Co to carry out Change in
Legislation Works involving Capital Expenditure:
(a) in relation to Phase 1 in the period following the Phase 1 Works Completion Date;
(b) in relation to Phase 2 in the period following the Phase 2B Works Completion Date;
- 13 -
(c) in relation to Phase 3 in the period following the Phase 3 Works Completion Date;
and
(d) (if Clause 52.7 applies) in relation to Phase 4 in the period following :
(i) the Phase 4 Works County Field Blocks A-E Completion Date; insofar as it
relates to County Field; and
(ii) the Phase 4 Works County Field Block F Completion Date insofar as it
relates to County Field; and
(iii) the Phase 4 Works Grizedale Completion Date insofar as it relates to

Grizedale; and
(iv) the Phase 4 Works County Main Completion Date insofar as it relates to
County Main
"Capital Expenditure" means any expenditure which falls to be treated as capital

expenditure in accordance with generally accepted accounting principles in the United
Kingdom from time to time;
"Cartmel" means the premises known as Cartmel College University of Lancaster more
particularly described in the Cartmel Lease and to be replaced as part of the works;
"Cartmel Lease" means the lease to be granted to Project Co in the Agreed Form of Cartmel
pursuant to Clause 6 of this Agreement;
"Cartmel Short Term Underlease" means the underlease to be granted in the Agreed Form
to the University of Cartmel pursuant to Clause 7 of this Agreement;
"Cartmel Underlease" means the underlease to be granted in the Agreed Form to the
University of Cartmel pursuant to Clause 9 of this Agreement;
"CD - X" means "X" Working Days prior to the relevant proposed Contract Date;
"CDM Regulations" means the Construction (Design and Management) Regulations 1994
and any approved code of guidance published in relation thereto;
- 14 -
"CEDR" has the meaning given to it at paragraph 3.3 in part 2 of Schedule 22 (Liaison and
Disputes Resolution Procedure) of this Agreement;
"Certificates of Title" means the certificates of title dated on or about the Effective Date
provided on behalf of the University giving details of the title to each of the Premises and
addressed to Project Co and the Senior Lenders;
"Change in Legislation" means the coming into effect after the Effective Date of:
(a) any Legislation; or
(b) any applicable judgement of a relevant Court which changes a binding precedent or
changes the interpretation of any Legislation;
"Change in Legislation Losses" means costs reasonably and properly incurred and
reasonable Losses suffered by Project Co, which arise as a direct result of a Qualifying
Change in Legislation, to enable Project Co to provide the Services over the Primary Period or
any period during which the Secondary Period Work Out Arrangements applythe Term, as a
result of complying with such Change in Legislation provided that such costs shall be reduced
to the extent that the University can reasonably demonstrate Cost Savings to Project Co as a
result of a reduction in the need to carry out repairs to and/or to replace all or parts of the
Project Co Accommodation;
"Change in Legislation Works" means any construction works which are reasonably and
properly required to be carried out to the Project Co Accommodation as being necessary to
comply with a Change in Legislation;
"Change in Operating Costs" means the difference between the reasonable and proper costs
of providing the Services following a particular Variation or Change in Legislation compared
to the costs reasonably and properly incurred in providing the Services prior to the Variation
or Change in Legislation;
"Change of Control" means a change in control or anyone acquiring control, "control" as

defined in this purpose by Section 840 of the Income and Corporation Taxes Act 1988;
"Closing Statement" means the financial statement in the Agreed Form which shows
payments to be made by the University (net of costs) in respect of the University
Accommodation Charge for the period from the Residence Year 2002/2003;
- 15 -
"Cluster" means a group of Rooms with a shared kitchen area;
"Commitment IRR" means the internal rate of return on Equity as evidenced on the Project
Summary Page of the Operating Financial Model as "Blended-Nominal (Commitment)";
"Comparable Universities" means the Victoria University of Manchester, Liverpool

University and York University;
"Comparable University Rates" means the rates being charged per room for student
accommodation similar in nature to the Accommodation by Comparable Universities;
"Comparable Rents" means rents being charged for student accommodation in the North
West of England which shall include Comparable University Rates;
"Compensation Event" means any of:
(a) a breach by the University or any University Party of any of its obligations under any
Project Documents (including but not limited to any such breach while the University
is exercising its step-in rights);
(b) a failure to grant Project Co (or where relevant, any Project Co Party), access to all or
part of the Site, the Adjoining Land and/or the Construction Site by virtue of any act
or omission of the University or any University Party;
(c) any event which becomes a Compensation Event pursuant to the provisions of this
Agreement;
(d) any actions claims demands and/or proceedings taken or made against the
University or Project Co in respect of any Uncertified Title Matters in relation to
County Field
but only to the extent that the same or the effect of the same does not arise from any
negligence, breach of contract or default of Project Co and/or any Contracting Associate or
any of their respective employees, agents, servants or advisers;
"Compensation Event Report" has the meaning given to it in Clause 42.2.3 (Compensation
Events) of this Agreement;
- 16 -
"Compensation Losses" means costs reasonably and properly incurred and reasonable
Losses suffered by Project Co which in any such case arise as a direct result of a
Compensation Event;
"Concerted Action Notice" means a notice issued by the University to Project Co and the
Senior Lenders pursuant to paragraph 14 of Part 1 of Schedule 13;
"Conduits" means the pipes wires ducts cables meters sewers drains watercourses gutters
gullies and other conducting media and any apparatus to which they are connected, including
pumping stations, electricity substations, gas governor stations, balancing ponds and other
equipment relating to the supply of Utilities, which are in on or over or under any of the
Premises or the Adjoining Land or through which the Utilities are conducted to and from any
of the Premises and then to publicly adopted Utilities or from publicly adopted Utilities via the
Adjoining Land at any time during the Perpetuity Period;
"Confidential Information" means all information (including the Project Documents)

whether technical, commercial or financial, disclosed (whether in writing, verbally or by any
other means and whether directly or indirectly) by or on behalf of either party whether before
or after the Effective Date excluding:
(a) information if and to the extent that it is within the public domain other than as a
result of breach of any undertaking or duty as to confidentiality; and
(b) Project Intellectual Property and Project Software;
"Consequential Variation" has the meaning given to it in Schedule 16 (Variations) of this

Agreement;
"Construction and Phasing Plans" means the plans identifying the Construction Site for
each Phase of the Works and in relation to the Phase 3 Works and the Phase 4 Works
identifying each Section [Note: new plan to be substituted] attached as Annexure 1;
"Construction Costs" has the meaning given to that expression in the Secured Term
- 17 -
"Construction Period" means in relation to Phase 1 and Phase 2 the period commencing on
the Effective Date and in relation to subsequent phasesPhase 3 on the commencement date of
the relevant Phase of the Works and,Phase 3 and, in relation to Phase 4 29 January 2007 in
all cases, ending on the relevant Works Completion Date;
"Construction Programme" means Project Co's programme with the features referred to in
Clause 33.6 (Design Development) of this Agreement for the execution and completion of the
Works, a copy of which is set out in Part 3 of Schedule 1 (Design Development Procedure) of
this Agreement;
"Construction Site" means the land required by Project Co to carry out any and each Phase
of the Works being the land shown for identification purposes edged red for each Phase of the
Works on the Construction and Phasing Plan and "relevant Construction Site" shall be
construed accordingly;
"Contract Date" means the date on which the University intends to enter into the Relevant
Residential Agreement as specified in the relevant Request Notice;
"Contracting Associate" means any Sub-Contractor and any guarantor of the sub-
contractor's obligations;
"Contractual Completion Date" means, as appropriate, the Long Term Lease Contractual
Completion Date, the Long Term Underlease Contractual Completion Date, the Short Term
Underlease Contractual Completion Date, the SW Campus Lease Contractual Completion
Date and the SW Campus Underlease Contractual Completion Date;
"Core Accommodation" means Graduate Hall, Graduate College, John Creed and Furness
(New);
"Core Accommodation Headlease – House 14 Graduate Hall" means the Core

Accommodation Headlease of that part of the Core Accommodation known as House 14
Graduate Hall and, subject to satisfaction of the House 14 Condition, to be granted to the
Project Co pursuant to clause 6 on the Long Term Lease Contractual Completion Date;
"Core Accommodation Headleases" means the leases to be granted in the Agreed Form by
the University to Project Co of the Core Accommodation pursuant to Clause 6;
"Core Accommodation Maintenance Regime" means that the University shall keep or
cause to be kept the Core Accommodation in a good state of repair and in good condition and
- 18 -
where necessary renew and replace the same when and as the same shall be worn out or
destroyed (in all cases with such (if any) exceptions as the Project Co may agree in writing);
"Core Accommodation Underleases" means the leases to be granted in the Agreed Form by
Project Co to the University of the Core Accommodation pursuant to Clause 9;
"Core Accommodation Underlease – House 14 Graduate Hall" means the Core

Accommodation Underlease of that part of the Core Accommodation known as House 14
Graduate Hall and, subject to satisfaction of the House 14 Condition, to be granted to the
University pursuant to Clause 9 on the Long Term Underlease Contractual Completion Date;
"Core Hours" means between the hours of 0800 and 1630 hours Monday to Friday excluding
bank holidays;
"Cost Savings" means all reasonable cost savings arising as a result of the carrying out of a
Variation or the carrying out of Change in Legislation Works or a Change in Operating Costs
arising from a Change in Legislation;
"Cost Change" means the circumstance in which the Annualised Operating Costs, Project Co
Operating Costs, Project Co Insurance Premia, Tax, Sinking Fund Contribution or Debt
Service or Fixed Soft FM Charge or Variable Soft FM Charge (as appropriate) for the
relevant Residence Year differs from the designated cost for the item (or items) in the Base
Case Financial Model as a result of:
(a) Variations in respect of which it has been agreed or determined pursuant to the
provisions of Schedule 16 that there shall be a change in the Base Case Requirements
or Annualised Operating Costs to reflect the Variation Costs or Variation Change in
Operating Costs (as appropriate); or
(b) an increase or decrease in the Actual Insurance Cost above the Financial Model
Insurance Cost; or
(c) the Market Testing of the Blue Collar Services pursuant to Part 2 of Schedule 11
(Services); or
(c) Not used; or
(d) any Qualifying Change in Legislation pursuant to Schedule 17; (Change in

Legislation) or
- 19 -
(e) the Benchmarking of the Services and/or the Soft FM Services pursuant to Part 2 of
Schedule 11 (Services); or
(f) any increase or decrease in the rate of corporation tax (or any tax which replaces or
supplements corporation tax as a tax on net profits of a UK tax resident company) in
excess of 30% for the Applicable Preceding Residence Year;
"County " means the premises known as County College University of Lancaster and (where
the provisions of Clause 52.7 apply) to be replacedpart of which (known as County Main) is
to be refurbished and part of which (known as County West) is to be demolished as part
of the Phase 4 Works, and more particularly described in the County Lease;
"County and Grizedale Demolition Dates" means the dates in the Construction Programme
(as modified from time to time by agreement between the parties as provided in this
Agreement) upon which County and Grizedale respectively are due to be demolished;
"County Lease" means the lease of County dated 7 October 2003 and made between the
University (1) and Project Co (2);
"County Field" means the premises known as County Field University of Lancaster and
more particularly described in the County Field Supplemental Lease;
"County Field Blocks A-E Works" means the works shown on the Construction and
Phasing Plans comprising part of the Phase 4 Works and which relate to the
construction of new student accommodation on County Field comprising Blocks A-E as
shown on the Construction and Phasing Plan which term for the avoidance of doubt is
known as the Section 1 Works under the Phase 4 Building Contract
"County Field Block F Works" means the works shown on the Construction and
Phasing Plans comprising part of the Phase 4 Works and which relate to the
construction of new student accommodation on County Field comprising Block F as
shown on the Construction and Phasing Plan which term for the avoidance of doubt is
known as the Section 2 Works under the Phase 4 Building Contract;
"County Field Supplemental Lease" means the Supplemental Lease of County Field to
be granted pursuant to clause 10.B of this Agreement
"County Field Supplemental Lease Contractual Completion Date" means the Phase 4
Effective Date;
- 20 -
"County Field Supplemental Underlease" means the Supplemental Lease of part of
County Field University of Lancaster to be granted to Project Co of County Field in the
Agreed Form to Project Co of County pursuant to Clause 6clause 10.B of this Agreement;
"County Field Works" means the County Field Blocks A-E Works and the County Field
Block F Works;
"County Main Works" means such Works shown on the Construction and Phasing Plan
as comprising part of the Phase 4 Works and which relate to the refurbishment of
County Main including the creation of the Retail, Social and Academic Space;
"County Short Term Underlease" means the underlease to be granted in the Agreed Form
toof County dated 26 September 2003 and made between Project Co (1) and the
University of County pursuant to Clause 7 of this Agreement(2);
"County West Demolition and Piazza Works" means the demolition of the existing
University building known as County West (shown hatched red on the plan attached to
the County Lease) and the construction of the Piazza shown on the Construction and
Phasing Plans and comprising part of the Phase 4 Works and which term for the
avoidance of doubt is known as the Section 5 Works under the Phase 4 Building
Contract;
"County Underlease" means the underleaseUnderlease of County to be granted in the

Agreed Form to the University of County pursuant to Clauseclause 9 of this Agreement;
"Court" means any court of competent jurisdiction;
"Date of Possession" means:
(a) in relation to the Phase 1 Works the Effective Date;
(b) in relation to the Phase 2 Works the Effective Date;
(c) in relation to the Phase 3 Works:-
(i) 3 February 2005 in respect of Section 1 and Section 2 (other than Block 34);
(ii) 29 March 2005 in respect of Block 34; and
- 21 -
(iii) 10 July 2006 in respect of Section 2A;
(d) (where the provisions of Clause 52.7 apply) in relation to the Phase 4 Works 31 July
2006 in relation to Grizedale and 31 July:
(i) 12 March 2007 in relation to County or such later date as is agreed or

determined pursuantField;
(ii) 12 March 2007 in relation to Grizedale;
(iii) subject to the provisions of Clause 52;29.3.3 7 January 2008 in respect of

County Main; and
(iv) 30 July 2007 in respect of those parts of the Construction Site required
for the County West Demolition and Piazza Works.
being the respective dates upon which the University shall grant Project Co vacant possession
of the relevant Construction Site for the applicable Phase of the Works and being the
respective dates also upon which Project Co assumes responsibility for the relevant
Construction Site, pursuant to the terms of this Agreement;
"Day" means a period of 24 hours ending at midnight;
"Debt Ratios" means the set of ratios comprising the Average Project Debt Service Cover
Ratio, the Average Total Annual Debt Service Cover Ratio, the Project Loan Life Cover
Ratio, the Project Annual Debt Service Cover Ratio, the Total Annual Debt Service Cover
Ratio and the Total Loan Life Cover Ratio as each such term is defined in the Secured Term
"Debt Service" has the meaning given to the expression "Scheduled Debt Service" in the
Secured Term Facilities Agreement;
"Deductions" means the deductions from the University Accommodation Charge as

calculated pursuant to Part 2 of Schedule 13 and the expression "Relevant Deductions" shall
be construed accordingly in relation to the applicable Residence Term;
- 22 -
"Deed of Variation" means the Deed of Variation of a Lease dated 24 April 2003 made
between The University (1) and Project Co (2) to be entered into pursuant to clause 4.1 such
deed to be in Agreed Form;
"Deed of Variation of the Leases" means the deed of variation of the Leases to be entered
into pursuant to clause 10A.1 such deed to be in the Agreed Form;
"Deed of Variation of the Underleases" means the deed of variation of the Underleases to
be entered into pursuant to clause 10.A.2 such deed to be in the Agreed Form;
"Deed of Surrender (Phase 1 Headlease Part)" means the Deed of Surrender of those parts
of the Headlease dated 24 April 2003 made between (1) The University and Project Co (2) to
be entered into pursuant to clause 4.1;
"Deeds of Surrender Long Term Leases" means those deeds of surrender in relation to the
parts of the Premises demised by the Long Term Leases shown hatched red on the demise plan
for the relevant Long Term leases and to be entered into pursuant to Clause 88.2 of this
Agreement such deeds of surrender to be in the Agreed Form;
"Deeds of Surrender Short Term Underleases" means those deeds of surrender in

relation to the Grizedale Short Term Underlease and the County Short Term Underlease
to be entered into pursuant to Clause 8.1 of this Agreement such deeds of surrender to be in
the Agreed Form;
"Deeds of Warranty" means the Building Contractor's Deed of Warranty and the Employer's
Agent's Deed of Warranty (as appropriate);
"Default Interest Rate" means the rate at which interest will accrue pursuant to Clause 7.3.1
(Default Interest) of the Secured Term Facilities Agreement;
"Delay Event" means any of:
(a) a Relief Event;
(b) a Compensation Event;
(c) a Qualifying Change in Legislation;
(d) a Works Variation;
- 23 -
(e) a Qualifying Variation;
(f) an event of Force Majeure;
"Demand Increasing Variation" means a variation whether or not initiated or deemed to be

initiated by the University or Project Co which it is agreed or determined has been initiated in
order to increase the Income from the Project Co Accommodation above the Modelled Rental
Income;
"Demand Sustaining Variation" means a variation whether or not initiated by the University
or Project Co which it is agreed or determined is required in order to maintain or restore
Income from the Project Co Accommodation to the level of Modelled Rental Income;
"Demerit Point" means the point recorded on the PMMS in accordance with paragraph 1 of
"Derogations Schedule" means the schedule of derogations in relation to phasePhase 3 and

Phase 4 annexed hereto;
"Design Data" means all calculations, designs, design information, specifications, plans,
drawings, graphs, sketches, models and other materials, including all eye readable or computer
or other machine readable data, prepared or to be prepared by or on behalf of Project Co for
the purposes of Project Co Operations;
"Design Development Procedure" means the procedure set out in Schedule 1 (Design
Development Procedure) of this Agreement;
"Design Development Programme" means the programme for the development of the
design for the Works which falls within the terms of Schedule 1 of this Agreement, a copy of
which is set out at Part 2 of Schedule 1 of this Agreement as the same may be altered in
accordance with the terms of this Agreement;
"Detailed Forward Maintenance Schedule" means the Schedule of forward maintenance to

the Project Co Accommodation to be prepared by Project Co and a copy of which is to be
delivered to the University in accordance with paragraph 11 of Part 1 of Schedule 11 (the
Services);
- 24 -
"Discriminatory Change in Legislation" means a Change in Legislation which is not a
Foreseeable Change in Legislation the terms of which apply to:
(a) the Project only and not to similar projects;
(b) the provision of the Services to the University and not to similar Universities;
(c) Project Co or the Shareholders and not to other persons; or
(d) the provision of services the same as or similar to the Works and/or Services or to the
holding of shares in companies whose main business is providing services the same as
or similar to the Works and/or Services;
"Disposal" means any sale or transfer of land other than a charge or mortgage, or the grant of
any other estate or interest in land (other than an occupational lease), or any contract or
agreement to do the same;
"Dispute" means any difference or dispute of whatever nature, including failing to agree on
any matter requiring to be agreed pursuant to the Project Documents, between the University
and Project Co (or their respective representatives provided for hereunder) arising under, out
of or in connection with any Project Document (including any question of interpretation
thereof but the said expression does not extend to any difference on any matter in respect of
which the relevant Project Document states that the relevant party's, or an Expert's, decision is
final or conclusive or the relevant party's discretion or determination is absolute);
"Dispute Resolution Procedure" means the procedure set out in Part 2 of Schedule 22
(Liaison and Dispute Resolution Procedure);
"Economic Assumptions" has the meaning given to that expression in the Secured Term
"Economic Reinstatement Test Ratio" means, in respect of any Test Date falling after the
Phase 34 Works Completion Date, for the period from (and including) the day after that Test
Date up to and including the Final Payment Date, the ratio of A to B where:
A is the aggregate (without double counting) of:
(i) the Net Present Value of the Projected Net Project Income in
respect of the relevant Test Date:
- 25 -
(ii) the Net Present Value of Projected Ground Rent; and
(iii) the balance (if any) standing to the credit of the Debt Service Reserve
Account, and
(iv) the balance (if any) standing to the credit of the BURDA which is
required to be paid into the Debt Service Account pursuant to clause
13.11 of the Senior Lenders Direct Agreement; and
(v) the balance (if any) standing to the Distribution Account required to
be paid into the Debt Service Account pursuant to the provisions of
clause 13.2 of the Accounts Agreement and the Blocked Distribution
Account required to be paid into the Debt Service Account pursuant
to clauses 11.2 of the Accounts Agreement
(vi) amounts standing to the credit of the Debt Service Account available
to repay the Term Facility or any further facility made available by
the Senior Lenders
B is the aggregate of the principal outstanding (including any principal, interest, periodic fees
and costs or expenses which have fallen due but have not been paid) under the Secured Term
Facilities Agreement.
In this definition, "Final Payment Date", "Net Present Value", " of the Projected Net
Project Income", "Projected Ground Rent"; "Distribution Account" "Blocked
Distribution Account" "Debt Service Account" "Debt Service Reserve Account" and
"Term Facility" shall each have the meaning given to them in the Secured Term Facilities
Agreement;
"Effective Date" means the date of this Agreement;
"Employer's Agent" means :
(i) The Bailey Partnership of 1 Walker Terrace, The Hoe, Plymouth PLI 3BN in respect
of Phases 1-3; and
- 26 -
(ii) Stephen Davies Associates of Edward House Deva Centre Trinity Way
Manchester M3 7BE in relation to the Phase 4 Works;
"Employer's Agent's Appointment" means :
(i) the agreement so titled in the Agreed Form made on or about the Effective Date;
(ii) in relation to the Phase 4 Works the agreement in the Agreed Form dated
2007 and pursuant to which Project Co has appointed or will appoint
the Employer's Agent to act on its behalf in administering the Building Contract on
behalf of Project Co;
"Employer's Agent's Deed of Warranty" means the warranty from the Employer's Agent to
the University in the form set out in Schedule 6 and in respect of the Phase 4 Works
Schedule 6A;
"Ensuite Bathroom" means those bathroom areas which form part of a Room;
"Equity" means the aggregate of the paid up ordinary and preference share capital of Project
Co and loan stock or other forms of subordinated debt participation by any of the shareholders
of Project Co or any connected entity of such shareholder;
"Equity IRR" means the internal rate of return on Equity as evidenced on the Project
Summary page under the heading "BIL Blended Nominal" of the Operating Financial Model
calculated on a commitment basis over the term of the Project;
"Equity Top-Up Payments" means the payments of that part of the URA Net Rental Income
necessary to fund any shortfall in Equity Top-Up Sums;
"Equity Top-Up Sums" means for the Applicable Current Residence Year an amount
equivalent to 5% of the Debt Service for that year;
"Essential Fixtures Fittings and Equipment" means:
(a) in relation to a Room in the Project Co Accommodation, the Room contains the
following items which are functional (according to the purpose for which they were
designed):
(i) a single bed with a good quality mattress and mattress cover;
- 27 -
(ii) a suitable robust desk and a chair (appropriate for a computer operator);
(b) in relation to a Kitchen Area the Kitchen Area contains the following (each being
functional according to the purpose for which it was designed):
(i) a larder fridge/freezer;
(ii) an electric cooker;
(iii) an oven and hob (including extractor fan);
(iv) a sink and drainer unit;
(v) a kettle;
(vi) a suitably robust dining table and one chair per Student;
(vii) a heat detector
(viii) a fire blanket;
(ix) a fire extinguisher;
(c) in relation to an Ensuite Bathroom the room contains the following (each being
functional according to the purpose for which it was designed):
(i) a shower;
(ii) a toilet with seat cover;
(iii) a wash hand basin with vanity unit or large shelf;
"Event of Insolvency" means in relation to Project Co, or (where paragraph 3.1 of Part 2 of
Schedule 11 (the Services) applies) in relation to the Hard FM Contractor Guarantor, that:
(b) a voluntary arrangement is made under part I of the Insolvency Act 1986 (the
"Insolvency Act"); or
- 28 -
(c) an administration order is made under part II of the Insolvency Act; or
(d) a receiver and manager or administrative receiver is appointed whether under part III
of the Insolvency Act or otherwise; or
(e) Project Co or (where paragraph 3.1 of Part 2 of Schedule 11 (the Services) applies
the Hard FM Contractor Guarantor goes into liquidation as defined in section 247(2)
of the Insolvency Act (other than a voluntary winding up solely for the purpose of
amalgamation or reconstruction while solvent); or
(f) a provisional liquidator is appointed under section 135 of the Insolvency Act; or
(g) an order is made for a scheme of arrangement under section 425 of the Companies
Act 1985;
"Event of Project Co Default" means any or all of the following events which are agreed to
be conditions which go to the essence of the Project Documents:
(a) any relevant Works Completion Certificate has not been issued by the relevant
Longstop Date for the applicable Phase Completion;
(b) an Event of Insolvency occurs in relation to Project Co;
(c) abandonment of the Works for a period of 50 consecutive days or more;
(d) following the Phase 3 Works Completion Date or (if Clause 52.7 applies), the Phase 4
Works Completion Date, fifty per cent or more of the Accommodation by number of
Rooms within the Project Co Accommodation are Unavailable for all or substantially
all of three (3) consecutive Half Term Periods;
(e) following the Phase 3 Works Completion Date (or if Clause 52.7 applies), the Phase 4
Works Completion Date, the Performance Deduction Percentages for three (3)
consecutive Half Term Periods are fifty (50) percent or more;
(f) a breach by Project Co of its obligation to take out and maintain required insurances
pursuant to the Project Documents;
- 29 -
(g) a breach of Project Co's obligations under any of the Project Documents which
substantially frustrates the University's ability to carry out its activities as a higher
education establishment;
"Event of Unavailability" means :
(a) in relation to any Room (not being a Room to which clause 35 (Alternative
Accommodation) applies) in the Monitored Premises which is either:-
(a) (i) the subject of a Student Residence Agreement; or
(b) (ii) for which a Student has a guaranteed offer of and has been allocated a Room at the
commencement of a Residence Year but which Student fails to occupy as a
result of the Unavailability of such Room
(b) in relation to any of the Retail Space, Social Space and/or Academic Space
the failure to meet any of the relevant Availability Criteria in respect of such Room or Retail
Space, Social Space and/or Academic Space or the Availability Mandatory Elements are not
present in respect of such Room and "Unavailable" and "Unavailability" shall be construed
accordingly;
"Excess Amount" has the meaning given to that expression in paragraph 7.1.3 of part 1 of
Schedule 13 (the University Accommodation charge and Performance Measurement System);
"Excusable Breaches" means breaches of the Project Documents by Project Co caused

directly by a Qualifying Change in Legislation, a Relief Event, a Compensation Event, a
Variation and/or an event of Force Majeure;
"Existing Accommodation" means Cartmel, Furness, Fylde, County and Grizedale (and
shall include for the period from the Effective Date until the date upon which the Grizedale
Short Term Underlease expires the Grizedale 20 Rooms) which are occupied by the
University and its students at the date of this Agreement and which are to be demolished and
in the case of Cartmel, Furness and Fylde and Grizedale rebuilt as part of the Project and in
the case of that part of County and Grizedale to be rebuilt as part of the Phase 4 Works (if the
provisions of Clause 52.7 apply)known as County West to be demolished and in relation to
that part of County known as County Main to be refurbished;
- 30 -
"Expert" means an appropriately qualified independent third party expert acting as an expert
and appointed in accordance with the provisions of Part 3 of Schedule 22 (Liaison and
Disputes Resolution Procedure) and owing a duty of care to both Parties to determine the
matter or matters referred to him and appointed by both Parties;
"Expert Determination" means the expert determination process carried out pursuant to part
3 of Schedule 22 (Liaison and Disputes Resolution Procedure);
"Facility Agent" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Facility Agent's Technical Adviser" has the meaning given to that expression in that
"Final Termination Notice" means a notice given by the University to Project Co pursuant
to Clause 49.1.2(b);
"Finance Parties" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Financial Model Insurance Cost" means the amount shown in the Base Case Financial
Model Worksheet MA Def Row 23 as payable each year by Project Co in respect of the
insurances required pursuant to the Project Documents (such sum to be RPI Indexed) such
cost as at the Effective Date being that set out in Schedule 27;
"Financing Agreements" means all agreements with Senior Lenders including any security
documentation and the Senior Lender's Direct Agreement in the Agreed Form (unless
otherwise agreed by the Parties) for the purpose of financing Project Co so as to enable it to
carry out the Project;
"First Term Loan Repayment Date" has the meaning given to that expression in the
"Fixed Soft FM Charge" means:
(a) for the period until the Residence Year commencing in September 2007 the sum
of in each Residence Year (RPI Indexed) rising to; and
- 31 -
(b) for the period from the Residence Year commencing in September 2007 until the
Benchmarking Date the sum of (RPI Indexed) if the Phase 4 Works are
completed in respect of the provision by the University of certain Soft FM Services to
Students occupying the Accommodation pursuant to the Soft FM Service Levels;in
each Residence Year; and
(c) from the period from each Benchmarking Date to the next Benchmarking Date
the amount for that Residence Year agreed or determined pursuant to the
provisions of part 2 of Schedule 11;
"Force Majeure" means any one or more of the following:
(a) war, civil war (whether declared or undeclared) armed conflict or terrorism affecting
England and Wales;
(b) nuclear, chemical or biological contamination; or
(c) pressure waves caused by devices travelling at supersonic speeds;
"Following Period" has the meaning given to that expression in the Senior Lenders'
Direct Agreement;
"Following Period Commencement Date" has the meaning given to that expression in
the Senior Lenders' Direct Agreement;
"Following Period Decision Notice" has the meaning given to that expression in the
Senior Lenders' Direct Agreement;
"Force Majeure Termination Sum" has the meaning given to it in paragraph 1.4 of part C
or (in respect of a Termination for Force Majeure during any period where the
Secondary Period (Non Default) Arrangements apply) paragraph 1.4 of Part C1 of
Schedule 20 (Termination Compensation);
"Forecast Data" means (for the Applicable Current Residence Year) the following
information:-
(a) the Relevant Required Rent;
- 32 -
(b) whether any Equity Top-Up Payment is required and whether this is due to (1) any
Cost Change in the Applicable Preceding Residence Year or (2) a Project Co
Accommodation Income Shortfall (or a combination of the two); and
(c) whether (and the extent to which) Locked-Up URA Net Rental Income that is then in
the Blocked URA Rental Distribution Account can be released to the University.
"Foreseeable Change in Legislation" means a Change in Legislation that was reasonably

foreseeable as at the date of this Agreement. In this definition "reasonably foreseeable"
means that it:
(a) had been published in a draft Bill as part of a Government Departmental Consultation
Paper and was enacted in a form substantially as that contemplated in the form of a
draft Bill as at the Effective Date;
(b) had been published in a Bill and was enacted in a form substantially as contemplated
in the form of the Bill as at the Effective Date; or
(c) had been published in a draft statutory instrument or published in the Official Journal
of the European Communities; and
(d) was a Change in Legislation which:
(i) either Project Co or any Contracting Associate or the Shareholders were

aware was to be introduced and/or;
(ii) a reasonably competent building contractor or a reasonably competent

facilities management contractor as the case may be would have been aware
was to be introduced and such persons were taking the Change in
Legislation into account in pricing designing constructing and/or carrying
out building or facilities management contracts or other leasing
arrangements;
"Full Enhanced Head Leases" has the meaning given to that expression in the Senior
Lender's Direct Agreement and "Relevant Full Enhanced Head Lease" shall be construed
accordingly;
"Furness" means the premises known as Furness College University of Lancaster as more
particularly described in the Furness Lease and to be replaced as part of the Works;
- 33 -
"Furness Lease" means the lease to be granted of Furness to Project Co pursuant to Clause 6
of this Agreement in the Agreed Form;
"Furness (New)" means that part of the University Residential Accommodation known as
Furness New as more particularly described in the relevant Core Accommodation Headlease
and Underlease;
"Furness Short Term Underlease" means the underlease to be granted of Furness to the
University pursuant to Clause 7 of this Agreement in the Agreed Form;
"Furness Underlease" means the underlease to be granted to the University of Furness

pursuant to Clause 9 of this Agreement in the Agreed Form;
"Fylde" means the premises known as Fylde College University of Lancaster, and to be
replaced as part of the Works, more particularly described in the Fylde Lease;
"Fylde Lease" means the lease to be granted to the Project Co of Fylde pursuant to Clause 6
"Fylde Short Term Underlease" means the underlease to be granted of Fylde to the
University in the Agreed Form pursuant to Clause 7 of this Agreement;
"Fylde Underlease" means the underlease to be granted to the University of Fylde in the
Agreed Form pursuant to Clause 9 of this Agreement;
"Good Industry Practice" means:
(a) in relation to the carrying out of the Works, the exercise of that degree of
skill, care and diligence reasonably to be expected of a properly qualified and
competent contractor which is experienced in carrying out works of a similar size,
scope, nature, complexity and value as the Works in relation to projects similar to the
Project; and
(b) in relation to the provision of the Services, the exercise of that skill care and
diligence which would be reasonably and ordinarily be expected from a skilled and
experienced operator providing the Services engaged in the same or similar type of
undertaking as the Project and under the same or similar circumstances and at the
same time as that in which the relevant matter arises;
- 34 -
"Government" means the government of the United Kingdom;
"Graduate College" means that part of the University Residential Accommodation known as
Graduate College as more particularly described in the relevant Core Accommodation
Headlease and Core Accommodation Underlease;
"Graduate Hall" means that part of the University Residential Accommodation known as
Graduate Hall as more particularly described in the relevant Core Accommodation Headlease
and Core Accommodation Underlease;
"Grizedale" means the premises known as Grizedale College University of Lancaster as

more particularly described in the Grizedale Lease and to be demolished as part of the Works
and (where Clause 52.7 applies) to be replaced as part of the Phase 4 Works;
"Grizedale 20 Rooms" means those study bedrooms forming part of Grizedale College but
not demised pursuant to the Grizedale Lease and which do not form part of the Works;
"Grizedale and County Leases Termination Date" means the date upon which each of the
Grizedale Lease and the County Lease automatically cease and determine pursuant to Clause
8.3 of the Grizedale Lease and the County Lease respectively;
"Grizedale Lease" means the lease to be granteddated 7 October 2003 of Grizedale toand
made between the University (1) and Project Co in the Agreed Form pursuant to Clause 6 of
this Agreement(2);
"Grizedale Short Term Underlease" means the underlease to be granteddated 7 October

2003 of Grizedale toand made between Project Co in the Agreed Form pursuant to Clause 7
of this Agreement(1) and the University (2);
"Grizedale Underlease" means the underlease to be granted to the University of Grizedale in

the Agreed Form pursuant to Clause 9 of this Agreement;
"Grizedale Works" means the Works shown on the Construction and Phasing Plan as
comprising part of the Phase 4 Works and which relate to the demolition of existing
structures at Grizedale and construction of new structures at Grizedale and which term
for the avoidance of doubt is known as the Section 4 Works under the Building contract;
- 35 -
"Ground Rent" means the rents payable pursuant to the Headleases which aggregate sum is
calculated from time to time in accordance with Schedule 14 of this Agreement;
"Half Term Period" means one of two equal periods during a Residence Term;
"Hard FM Contract" means the agreement so titled made on or about the Effective Date
between (1) Project Co and (2) the Hard FM Contractor for the provision of hard facilities
maintenance works at or within the Project Co Accommodation such agreement to be in the
Agreed Form and all ancillary documents thereto together with any replacement contract
entered into in accordance with the provisions of this Agreement;
"Hard FM Contract Guarantee" means the guarantee from Jarvis Plc of the Hard FM
Contractor's obligations in favour of Project Co;
"Hard FM Contractor" means the facilities maintenance contractor referred to in Clause

23.1.2 of this Agreement or such substitute(s) as may be appointed by Project Co for the time
being pursuant to a replacement of the Hard FM Contractor in accordance with the provisions
of the Project Documents;
"Hard FM Contractor Guarantor" means the guarantor under the Hard FM Contract
Guarantee;
"Hard FM Services" means the services described in the Output Specification to be provided
by Project Co to the Project Co Accommodation;
"Headleases" means the SW Campus Leases the Short Term Leases and the Long Term
Leases and the County Field Supplemental Lease and "relevant Headlease" shall be
"Helpdesk" has the meaning given to that expression in the Output Specification;
"Historic Demand Ratio" means (as at the applicable RC Test Date) (x) the Aggregate
Attending Student Level divided by (y) the Aggregate Historic Room Availability;
"Historic Occupancy (Phase 4)" means in relation to Residence Year 2005 the number of
Student Residence Agreements entered into for that year with Full Time Students and in
relation to Residence Year 2006 the number of Student Residence Agreements for which Full
Time Students have either entered into or committed to enter into as at the commencement of
the Residence Year immediately prior to the Phase 4 Test Date;
- 36 -
"Historic Rental Income (Phase 4)" means the Income for the applicable Historic Test
Period Year (Phase 4);
"Historic Test Period" means (as at the applicable RC Test Date) the three complete
Residence Years immediately preceding the RC Test Date;
"Historic Test Period Year" means any Residence Year within the Historic Test Period;
"Historic Test Period (Phase 4)" means (as at the Phase 4 Test Date) the two complete
Residence Years immediately preceding the Phase 4 Test Date;
"Historic Test Period Year (Phase 4)" means a Residence Year within the Historic Test
Period (Phase 4);
"Holdco" means UPP Lancaster Holdings Limited (No 4647019);
"House 14 Condition" means the earlier of:
(a) the date upon which Bradford and Bingley Building Society consent to the
grant of the Core Accommodation Headlease – House 14 Graduate Hall and the Core
Accommodation Underlease – House 14 Graduate Hall (it being acknowledged by the
parties that there is no obligation upon the University to seek such consent); and
(b) the date upon which all monies owed by the University under the Bradford
and Bingley Loan have been fully satisfied;
"Incident Rectification Report" has the meaning given to it in paragraph 2.4 of Part 3 of
Schedule 13 (the University Accommodation Charge and Performance Measurement System)
of this Agreement;
"Income" means the licence fees and other sums excluding deposits and other reimbursable
expenses and excluding in relation to the Townhouses any payments received in respect
of utilities consumption payable by any Student pursuant to a Student Residence Agreement;
"Income, Expenditure and Occupancy Statement" means the statement to be provided by

the University to Project Co in each Applicable Current Residence Year in accordance with
the provisions of paragraph 3 of Part 1 of Schedule 13;
- 37 -
"Infrastructure Contribution" means the sum (comprising a single payment or a series of
payments) of exclusive of any Value Added Tax payable
thereon unless Clause 43.1(b) applies;
"Infrastructure Variation" means the variation which the parties shall give effect to as set
out at Part 2 of Schedule 16 (Variations);
"Infrastructure Works" means the works (forming part of the Works) which are described
in Schedule 10;
"Initial Report" has the meaning given to it in Clause 42.2.2 (Compensation Events) of this
Agreement;
"Instalment Arrangements" has the meaning given to it in Part F of Schedule 20;
"Insurance Account" means a deposit account (with an appropriate period of notice for
withdrawal of monies) bearing interest at market rate in the joint names of Project Co and the
University into which relevant Insurance Proceeds will be deposited with the Account Bank or
with such other bank that the Parties acting reasonably agree;
"Insurance Proceeds" means any insurance proceeds received by Project Co in respect of an

event or series of events which destroys or damages the whole or any part of the
Accommodation or any Building or Buildings or any Premises as the case may be;
"Insured" means those persons named as joint insured in the insurances taken out pursuant to
Clause 53 (Insurance obligations in relation to the Accommodation) of this Agreement;
"Intellectual Property" means all current and future legal and/or equitable interests in
registered or unregistered trade marks, patents, registered designs, utility models, applications
of any of the foregoing, copyrights, design rights, inventions, confidential information, know-
how or other intellectual property rights (including but not limited to sui generis rights in
relation to database(s));
"John Creed House" means that part of the University Residential Accommodation known
as John Creed Hall as more particularly described in the relevant Core Accommodation
Headlease and Core Accommodation Underlease;
"Kitchen Area" means the communal kitchen areas in a Block serving Rooms each as shown
in Project Co's Proposals;
- 38 -
"Lancaster University Campus" means all that land shown edged red on the Shepherd
Epstein Hunter plan 2 of 1999 attached at Annexure 2;
"Latent Defect" means:
(a) subject to sub-paragraph (b), any defect in the design and/or construction
and/or workmanship and/or the presence of hazardous materials used in the
construction of County which has not been identified in or is not reasonably
foreseeable from the content of the Phase 4 Surveys but excluding:
(i) any such defect which would have been foreseeable if the author of the
Phase 4 Surveys had exercised the degree of skill and care reasonably to
be expected of a properly qualified professional consultant experienced
in compiling surveys similar to the relevant Phase 4 Surveys in relation
to projects similar to the Project; or
(ii) any such defect which is known to Project Co or the Building Contractor
at the Phase 4 Effective Date or
(iii) any defect in the County Main Works; and
(b) in the case of the pre-cast concrete panels at County Main, any works of repair
to such pre-cast concrete panels which have not been identified as currently
required by the Phase 4 Surveys or would not have been identified if the author
of the Phase 4 Surveys had exercised the degree of skill and care reasonably to
be expected of a properly qualified professional consultant experienced in
compiling surveys similar to the relevant Phase 4 Surveys in relation to projects
similar to the Project
"LCIA" means the LCIA (formerly known as the London Court of International Arbitration);
"Leases" means the SW Campus Leases and the Long Term Leases;
"Legislation" means any Act of Parliament or subordinate legislation within the meaning of
section 21(1) of the Interpretation Act 1978 any exercise of the Royal Prerogative and any
enforceable community right within the meaning of section 2 of the European Communities
Act 1972 in each case in the United Kingdom and any regulations or requirements of the
- 39 -
Higher Education Funding Council for England and Wales if and to the extent that the
University has to comply with such regulations or requirements;
"Let" means at the commencement of each Residence Year or at any time during that
Residence Year that a Room in the Accommodation is the subject of a Student Residence
Agreement with a student who has enrolled for study at the University or during any Vacation
Period, a Vacation Use Agreement or a binding and unconditional agreement to enter into the
same;
"Letting Periods" means the number of weeks for which a Room is to be Let pursuant to a
Student Residence Agreement, as determined by the University in accordance with the
provisions of Schedule 12 (Administration Arrangements and Allocations Policy) of this
Agreement and provided that, for the avoidance of doubt, the University shall, subject to the
terms of Schedule 12 (Administration Arrangements and Allocations Policy) of this
Agreement, be entitled to Let Rooms within the Accommodation and the University
Residential Accommodation on differential Letting Periods and "Relevant Letting Period"
shall be construed accordingly;
"Liaison and Disputes Resolution Procedure" means the procedure set out in Parts 1 and 2
of Schedule 22 (Liaison and Dispute Resolution Procedure) of this Agreement for the
resolution of any Dispute;
"Liaison Procedure" means the procedure set out at Part 1 of Schedule 22 (Liaison and
Dispute Resolution Procedure);
"Link Road" means the link road to be constructed by the Developer from the junction of
Chapel Lane and Hazelrigg Lane to the A6 but excluding the junction works to be constructed
by the local highway authority pursuant to an agreement (which may be a combined
agreement) under sections 278 and 38 of the Highways Act 1980 between the Developer, the
University and Lancashire County Council;
"Locked-Up URA Net Rental Income" means that part of the URA Net Rental Income
from time to time standing to the credit of the Blocked URA Rental Distribution Account less
any amounts which the University has deducted from the University Accommodation Charge
pursuant to Clause 7.1.3 of Schedule 13 (the University Accommodation Charge and
Performance Measurement System);
"Longstop Date for Phase Completion" means any or all of the Longstop Date for Phase 1
Works Completion, the Longstop Date for Phase 2A Works Completion, the Longstop Date
- 40 -
for Phase 2B Works Completion, the Longstop Date for Phase 3 Works Completion and/or
(where Clause 52.7 applies) the Longstop Date for Phase 4 Works Completion as the context
so permits and "relevant Longstop Date for Phase Completion" shall be construed
accordingly;
"Longstop Date for Phase 1 Works Completion" means the date two years after the Target
Date for Phase 1 Works Completion;
"Longstop Date for Phase 2A Works Completion" means the date two years after the
Target Date for Phase 2A Works Completion;
"Longstop Date for Phase 2B Works Completion" means the date two years after the
Target Date for Phase 2B Works Completion;
"Longstop Date for Phase 3 Works Completion" means the date two years after the last of
the dates in the Target Date for Phase 3 Completion;
"Longstop Date for Phase 4 Works Completion" means (in the circumstances where
Clause 52.7 applies) the date two years after the latest of the dates in the definition of the
Target Date for Phase 4 Works Completion (as the same may be extended in accordance
with this Agreement);
"Long Term Leases" means the leases of Phase 3 and Phase 4 including the County Field
Supplemental Lease to be entered into between the University (1) and Project Co (2) and
granted or to be granted in accordance with the provisions of this Agreement;
"Long Term Lease Contractual Completion Date" means the later of:
(a) the Effective Date;
(b) the date on which a court of competent jurisdiction authorises an agreement

excluding in relation to the relevant Long Term Lease the provisions of sections 24 to
28 of the Landlord and Tenant Act 1954; and
(c) in the case of the Core Accommodation Headlease – House 14 Graduate Hall the
Satisfaction Date;.
except in relation to the County Field Supplemental Lease where the provisions of clause
10.B.1 apply
- 41 -
"Long Term Underlease Contractual Completion Date" means:
(a) in relation to the Fylde Underlease and the Cartmel Underlease and the Furness
Underlease the later of (i) the tenth Working Day next following the Phase 3 Works
Completion Date; and (ii) the date on which a court of competent jurisdiction
authorises an agreement excluding in relation to the relevant underlease the
provisions of sections 24 to 28 of the Landlord and Tenant Act 1954; and
(b) (where the provisions of Clause 52.7 apply) in relation to the County Underlease and
the Grizedalei) in relation to the County Field Supplemental Underlease
the tenth Working Day next following the later of (i) Phase 4 Works
Completion Date (ii) the date on which a court of competent jurisdiction
authorises an agreement excluding in relation to the relevant underlease the
provisions of sections 24 to 28 of the Landlord and Tenant Act 1954Phase 4
Works County Field Completion Date (ii) in relation to the Grizedale
Underlease the tenth Working Day next following the Phase 4 Works
Grizedale Completion Date (iii) in relation to the County Underlease the
tenth Working Day next following the Phase 4 Works County Main
Completion Date; and
(c) in relation to the Core Accommodation Underleases the later of:
(i) the Effective Date;
(ii) the date on which a court of competent jurisdiction authorises an

agreement excluding in relation to the relevant Lease the provisions of
sections 24 to 28 of the Landlord and Tenant Act 1954; and
(iii) in the case of the Core Accommodation Underlease – House 14

Graduate Hall the Satisfaction Date;
"Long Term Underleases" means together the Cartmel Underlease, the Furness Underlease
and the Fylde Underlease and (where the provisions of Clause 52.7 apply) the County
Underlease the County Field Supplemental Underlease, and the Grizedale Underlease and
the expression "Long Term Underlease" shall be construed accordingly;
- 42 -
"Loss" or "Losses" means all damages, losses, liabilities, costs, expenses (including legal
and other professional charges and expenses) and charges whether arising under statute
contract or at common law or in connection with judgements proceedings internal costs or
demands;
"LU Cross-Default" has the meaning given to that expression in the Senior Lenders' Direct
Agreement;
"Major Disposal" means any Obligatory Major Disposal or any Voluntary Major Disposal;
"Marketing Plan" means the plan for pricing, promoting and allocation of the Campus
Accommodation to Students, as agreed in accordance with the provisions of Schedule 12
(Administration Arrangements and Allocations Policy) of this Agreement, which shall include
without limitation:-
(a) the setting of the Nominated Room Rates and Letting Periods;
(b) the design and production of brochures, internet sites and other communication media
to promote the Campus Accommodation; and
(c) the University's proposals for allocating rooms situate within the Campus
Accommodation to Students.
"Market Testing Review Date" means each fifth anniversary of 1 September 2002;
"Master Agreement" means this Agreement;
"Material Adverse Effect" means any event or matter which it is agreed or determined
would have a material adverse effect on:
(a) the present or future financial condition of the University in any material
way such that it would be unable to comply with the covenants contained in
Clause 11 of the Senior Lenders Direct Agreement;
(b) the present or future ability of the University duly to perform all or any of
its material obligations (including, without limitation, its payment
obligations) which it is expressed to undertake under any of the Project
Documents; or
- 43 -
(c) the validity or enforceability of the Project Documents against the
University or the rights and remedies of Project Co under the Project
Documents;
"Matter" has the meaning given to it in Part 2 of Schedule 22 of this Agreement (Liaison and
Dispute Resolution Procedure);
"Mediation" means a mediation process carried out pursuant to paragraph 3 of Part 2 of

Schedule 22 (Liaison and Disputes Resolution Procedure);
"Mediator" has the meaning given to it at paragraph 3.3 Part 2 of Schedule 22 of this
Agreement (Liaison and Dispute Resolution Procedure);
"Merger" means any Obligatory Merger or any Voluntary Merger;
"Modelled Equity Amounts" means the cashflows to Equity as shown in the Operating
Financial Model (where the provisions of Part B of Schedule 20 apply) and the Base Case
Financial Model (where the provisions of part A of Schedule 20 apply) Worksheet "Cashflow"
Rows 45 ("Drawdowns (Repayment) – Sub Debt), 57 ("Cash Input interest Sub Debt) 69
("Cash Flow to Ordinary Shareholders – interest) and 70 (Cashflow to ordinary shareholders –
investment") as the same may be adjusted pursuant to the provisions of this Agreement;
"Modelled Rental Income" or "MRI" means the amount of Income modelled by Project Co
to be receivable in respect of the Accommodation as shownreferred to in Schedule 26 for the
relevant Residence Year which amount shall be RPI Indexed plus 0.5% for each of the first
four Residence Years from the Effective Date for the Residence Year 2007/8
and for each of the next six Residence Years be the sum shown for that year in the
Agreed Form Document referred to in schedule 26, increased by a percentage amount
equivalent to the aggregate percentage increase resulting from the following formula:
Where:
- 44 -
and thereafter RPI Indexed and as may be further adjusted pursuant to the provisions of this
Agreement;
"Monitored Premises" means each of the Premises the subject of a Long Term Underlease;
"Moody's" means Moody's Investor Services, Inc.;
"Necessary Consents" means all approvals, consents, licences, permissions, certificates and
statutory agreements required from any competent authority and all consents and agreements
from and with third parties necessary for carrying out or completing the Works or for the
conduct of the Project or the carrying out of a Variation in accordance with this Agreement or
to permit the occupation and use of the Project Co Accommodation including (without
limitation), Planning Permissions, building regulation consents and fire regulation consents;
"Nominated Room Rates" means the rents per week to be paid by Students pursuant to each
Student Residence Agreement (set by the University at the commencement of each Residence
Year in accordance with the provisions of Schedule 12 (Administration Arrangements and
Allocations Policy) of this Agreement);
"Non-Acceptable Repayment Terms" has the meaning given to that expression in the
"Non-Compliant Incident" or "NCI" means a failure by Project Co to comply with the

relevant Service Level in respect of the Monitored Premises in relation to the Project Co
Accommodation as reported to the Helpdesk;
"Non-Core Accommodation" means the University Residential Accommodation other than

the Core Accommodation;
"Non-Core Accommodation Maintenance Regime" means thatwhere the provisions of

Clause 66 apply the University will cause the Non-Core Accommodation to be maintained to
a standard that will maintain such accommodation in a lettable state to Students for residential
purposes unless and to the extent that Rooms are taken out of use as permitted under Clause 66
or the University is no longer required to maintain such accommodation pursuant to Clause 66;
"Non-Core Hours" means the hours in a Day other than the Core Hours;
"Notice of Adjudication" has the meaning given to it in paragraph 4.1 of Part 2 of Schedule
22 (Liaison and Disputes Resolution Procedure);
- 45 -
"Notice of Expert Dispute" has the meaning given to it in paragraph 2 of Part (a) of part 3 of
Schedule 22 (Liaison and Disputes Resolution Procedure);
"Notice of Mediation" has the meaning given to it in paragraph 3.1 of Part 2 of Schedule 22
(Liaison and Disputes Resolution Procedure);
"Notice of Multi-Disciplinary Expert Dispute" has the meaning given to it in paragraph 6

of part (a) of Part 1 of Schedule 22 (Liaison and Disputes Resolution Procedure);
"Notification Date" means the first to occur of:
(a) the issue of a University Proposed Transaction Notice; and
(b) the date of the applicable Major Disposal or Merger;
"Objection Notice" has the meaning given to it at paragraph 3.1.2 or 3.6 (as appropriate) in
Part 1 of Schedule 16 (Variations) of this Agreement;
"Obligatory Major Disposal" means a disposal (as required by Legislation) by the University
or any member of the University Group of all or part of the assets of the University Group
(disregarding the Accommodation for these purposes);
"Obligatory Merger" means a merger, amalgamation or consolidation (which is required by

Legislation) of the University with another university or higher education institution or
educational establishment;
"Occupier" means an occupier or licensee of any part of the Premises;
"Off-Site Work Areas" means all workshops or other areas (not within the Construction
Site) at which any Works are being prepared or carried out;
"Operating Costs" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Operating Financial Model" has the meaning given to that expression in the Secured Term
- 46 -
"Operational Phase" means in relation to the Existing Accommodation the period from the
Effective Date until the relevant Works Commencement Date and otherwise in relation to any
Phase of the Works the date from the issue of the Works Completion Certificate to and
including the Term Expiry Date or if earlier the date upon which the Project Documents
terminate pursuant to the provisions of Clause 49.11Termination Date;
"Outline Forward Maintenance Schedule" means the outline forward maintenance

Schedule for each Phase of the Works attached as Annexure 3 to this Agreement;
"Output Brief" means the "Output Brief Built Environment" for the Project Co
Accommodation a copy of which is attached as Annexure 9 to this Agreement and any
variation made thereto in accordance with the Project Documents and in relation to Phase 3
subject to the Derogations Schedule and Phase 4;
"Output Specification" means the Services Specification attached to this Agreement as

Annexure 4;
"Outstanding Senior Debt" means without double counting:
(a) all amounts outstanding at the Termination Date amounts referred to in paragraph (b)
below), including default interest on sums not paid on the due date, from Project Co
to the Finance Parties under the Financing Agreements; and
(b) all amounts including costs of early termination of interest rate hedging
arrangements and other breakage costs, including for the avoidance of doubt interest
swaps entered into by Project Co and/or Holdco payable to the Finance Parties, as a
result of a prepayment under the Financing Agreements, subject to Project Co
mitigating all such costs to the extent reasonably possible (unless the amount or the
formula for determining the amount of such costs are fixed in advance under the
terms of the Financing Agreements);
but shall exclude all accounts outstanding at the Termination Date in respect of the Equity
Bridge Loan (as that expression is defined in the Secured Term Facilities Agreement) and
Senior Debt shall be construed accordingly;
"Parties" means the University and Project Co;
- 47 -
"Payment Date" means (in each Applicable Current Residence Year) 24 November, 24
March and 24 July and the expressions "November Payment Date", "March Payment Date"
and "July Payment Date" shall be construed accordingly;
"PD - X" means "X" Working Days prior to the relevant Payment Date;
"PD + Y" means "Y" Working Days after the relevant Payment Date;
"Performance Monitoring Marking Sheets" or "PMMS" means those sheets for marking
performance of the Services attached at appendix 1 to Schedule 13 (the University
Accommodation Charge and Performance Measurement System) of this Agreement;
"Performance Monitoring Report" means the monthly monitoring report of Project Co's
performance of the Hard FM Services containing the information set out in paragraph 1.3 of
"Performance Monitoring System" means the performance monitoring regime set out in
of this Agreement;
"Performance Deduction Percentage" means the percentage used to determine the Services
Deductions to be made in respect of a Residence Term calculated pursuant to paragraph 3 of
"Perpetuity Period" means the period of 80 years commencing on the Effective Date;
"Phase of the Works" means any or all of the Phase 1 Works, the Phase 2 Works, the Phase
3 Works and/or (where the provisions of Clause 52.7 apply) the Phase 4 Works, as the context
so permits and "relevant Phase of the Works" shall be construed accordingly;
"Phase 1" means the premises known as Phase 1 South West Campus and more particularly
described in the Phase 1 Lease;
"Phase 1 Lease" means the lease to be granted of Phase 1 to Project Co pursuant to Clause 4
- 48 -
"Phase 1 Underlease" means the underlease to be granted of Phase 1 to the University
"Phase 1 Works" means those parts of the Works described as such in Project Co's Proposals
relating to the SW Campus;
"Phase 1 Works Completion Date" means the date on which the Works Completion
Conditions for the Phase 1 Works are satisfied, being either the date stated in the Works
Completion Certificate for the Phase 1 Works or the date determined by the Adjudicator under
the Liaison and Disputes Resolution Procedure as being the date upon which the Works
Completion Certificate for the Phase 1 Works should have been issued;
"Phase 2" means the premises known as Phase 2 South West Campus and more particularly
described in the Phase 2 Lease;
"Phase 2 Lease" means the lease to be granted of Phase 2 to Project Co pursuant to Clause 4
"Phase 2 Works" means those parts of the Works relating to the South West Campus
described as such in Project Co's Proposals and which comprise both the Phase 2A Works and
the Phase 2B Works;
"Phase 2A Underlease" means the underlease to be granted of Phase 2A to the University

"Phase 2A Works" means that part of the Phase 2 Works described as such in Project Co's
Proposals;
"Phase 2A Works Completion Date" means the date on which the Works Completion
Conditions for the Phase 2A Works are satisfied, being either the date stated in the Works
Completion Certificate for the Phase 2A Works or the date determined by the Adjudicator
under the Liaison and Disputes Resolution Procedure as being the date upon which the Works
Completion Certificate for the Phase 2A Works should have been issued;
"Phase 2B Works" means that part of the Phase 2 Works described as such in Project Co's
Proposals;
"Phase 2B Works Completion Date" means the date on which the Works Completion
conditions for the Phase 2B works are satisfied being either the date stated in the Works
- 49 -
Completion certificate for the Phase 2B Works or the date determined by the Adjudicator
under the Liaison and Disputes Resolution Procedure as being the date upon which the Works
Completion Certificate for the Phase 2B Works should have been issued;
"Phase 2B Underlease" means the underlease to be granted of Phase 2B to the University in

the Agreed Form pursuant to Clause 95;
"Phase 3" means each of Cartmel, Furness and Fylde;
"Phase 3 Works" means those parts of the Works described as such in Project Co's Proposals
and which relate to the demolition and rebuilding of Cartmel, Furness and Fylde College and
the demolition of Grizedale;
"Phase 3 Works Completion Date" means the date on which the Works Completion
Conditions for the Phase 3 Works being all of Sections 1, 2 and 2A are satisfied, being either
the date stated in the Works Completion Certificate for the last Section to satisfy the Works
Completion Conditions or the date determined by the Adjudicator under the Liaison and
Disputes Resolution Procedure as being the date upon which the Works Completion
Certificate for the last Section should have been issued;
"Phase 4" means each of County, County Field, the Piazza and Grizedale;
"Phase 4 Election Notice" has the meaning given to that expression in Clause 52.1;
"Phase 4 Financing Conditions Precedent" means the securing by Project Co of third party
finance for the carrying out of the Phase 4 Works pursuant to the provisions of Clause 52.2
and the satisfaction of any conditions precedent specified by lenders which must be fulfilled
prior to first drawdown of such funding;
"Phase 4 Building Contract" means the contract dated on or about the Phase 4 Effective
Date made between Project Co (1) and Norwest Holst Limited (2);
"Phase 4 Test Date" means the start of the Residence Year commencing in September 2006
or (in the circumstances provided in Clause 52.8) the start of the Residence Year commencing
in September 2007;Effective Date" means 2007
"Phase 4 Test Forecast Period" means the three Residence Years immediately following the
Phase 4 Test Date;
- 50 -
"Phase 4 Surveys" means the surveys and reports carried out in respect of County Main
listed at Annexure 10;
"Phase 4 Works" (where the provisions of Clause 52.7 apply) means those parts of the
Works described as such in Project Co's Proposals being the final phase of the Works relating
to the demolition and rebuilding of County and the rebuilding of Grizedaleincluding the
County West Demolition and Piazza Works, the County Field Works, the Grizedale
Works and the County Main Works;
"Phase 4 Works Completion Date" (where the provisions of Clause 52.7 apply) means the
date on which the Works Completion Conditions for the Phase 4 Works are satisfied, being
either the date stated in the relevant Works Completion Certificate for the Phase 4 Works or
the date determined by the Adjudicator under the Liaison and Disputes Resolution Procedure
as being the date upon which the Works Completion Certificate for the Phase 4 Works should
have been issued;
"Phase 4 Works Conditions Precedent " means the following conditions (individually, a
"Phase 4 Test") to be met at the Phase 4 Test Date:
(1) that Historic Rental Income (Phase 4) for each of the Residence Years in the Historic
Test Period (Phase 4) was not less than 97.5% of Base Case Rental Income (Phase 4);
"Phase 4 Works County Field Blocks A-E Completion Date" means the date on which
the Works Completion Conditions for the County Field Blocks A-E Works are satisfied,
being either the date stated in the relevant Works Completion Certificate for the County
Field Blocks A-E Works or the date determined by the Adjudicator under the Liaison
and Disputes Resolution Procedure as being the date upon which the Works Completion
Certificate for County Field Blocks A-E Works should have been issued;
(2) that there is no Sector Adverse Change or University Material Adverse Change that is
continuing;
"Phase 4 Works County Field Block F Completion Date" means the date on which the
Works Completion Conditions for the County Field Block F Works are satisfied, being
either the date stated in the relevant Works Completion Certificate for the County Field
Block F Works or the date determined by the Adjudicator under the Liaison and
Disputes Resolution Procedure as being the date upon which the Works Completion
Certificate for the County Field Block F Works should have been issued;
- 51 -
(3) that there are no Events of Default or Potential Events of Default (as the expressions
are defined in the Secured Term Facilities Agreement) under the Financing
Agreements which (in either case) are continuing; and
"Phase 4 Works County Field Completion Date" means the Phase 4 Works Country
Field Blocks A-E Completion Date and the Phase 4 Works Country Field Block F
Completion Date;
(4) that Historic Occupancy (Phase 4) for each of the Residence Years in the Historic
Test Period (Phase 4) was not less than 95% of the Aggregate Historic Room
Availability (disregarding for these purposes any Proposed Further Rooms, the Added
Room Factor and (for the Residence Year commencing in September 2005 only)
those Rooms contained in the Grizedale Short Term Lease); and
"Phase 4 Works County Main Completion Date" means the date on which the Works
Completion Conditions for the County Main Works are satisfied being either the date
stated in the relevant Works Completion Certificate for the County Main Works or the
date determined by the Adjudicator under the Liaison and Dispute Resolution
Procedure as being the date upon which the County Main Works should have been
issued.;
(5) the number of Attending Students forecast over the Phase 4 Test Forecast Period will
not fall below the Attending Student Level Floor (Phase 4) for any Residence Year in
the Phase 4 Test Forecast Period;
"Phase 4 Works Grizedale Completion Date" means the date on which the Works
Completion Conditions for the Grizedale Works are satisfied being either the date stated
in the relevant Works Completion Certificate for the Grizedale Works or the date
determined by the Adjudicator under the Liaison and Dispute Resolution Procedure as
being the date upon which the Works Completion Certificate for the Grizedale Works
should have been issued;
"Phase 4 Works Cut Off Date" means 30 November 2006 (or 30 November 2007 in the
circumstances set out in Clause 52.8) each date extended until the conclusion of any Expert
determination submitted pursuant to Clause 52.4.3;
"Piazza " means the area forming part of the Lancaster University Campus and upon
which certain of the County West Demolition and Piazza Works are to be carried out
shown on Construction Plan and forming Part of the Phase 4 Works;
"Planned Maintenance Schedule" means the planned maintenance Schedule to be prepared

by Project Co and a copy of which is to be delivered to the University in accordance with
paragraph 11.5 of Schedule 11 (Services);
- 52 -
"Planning Acts" means the Town and Country Planning Act 1990, the Planning (Listed
Buildings and Conservation Areas) Act 1990, the Planning (Hazardous Substances) Act 1990
and the Planning (Consequential Provisions) Act 1990 and the Planning and Compensation
Act 1991 and all regulations, orders and subsidiary legislation made pursuant thereto;
"Planning Agreement" means an obligation or agreement under section 104 of the Water
Resources Act or sections 38 and/or 278 of the Highways Act or the corresponding or similar
sections of any corresponding local legislation relating to any highway, matter, statutory
undertaker, public or local authority;
"Planning Permissions" means the outline planning permissions dated 22 July 2002 No.
02/00523/OUT in respect of Phases 3 and 4 of the Works and the outline planning permission
dated 5 September 2002 (No. 02/00525/0UT) and reserved matters approval dated 21 October
2002 in respect of Phases 1 (part) and 2 of the Works as varied by a permission dated 13
January 2003 (No. 02/012421/FUL) and in respect of Phase 4 the Planning Permission
dated 21 August 2006 Ref: 06/00759/FUL;
"Post Refinancing Debt Service" means, on the assumption that such Refinancing has taken
place, the annual debt service (taking into account any Variation which has been implemented
pursuant to a Variation Order issued in accordance with Schedule 16 (Variations) and which
has been funded by further or additional borrowings by Project Co and any Rescue
Refinancing, to the extent only that they have an effect on scheduled debt service) under the
terms of any senior finance documents which amend or replace the Financing Agreements
immediately following the Refinancing and as such annual debt service is shown in the
updated Operating Financial Model produced pursuant to clause 46.3.2 (which financial
model may sculpt the repayment profile of such senior debt as Project Co shall consider
applicable);
"Post Refinancing Equity IRR" means the Commitment IRR, as reflected in the Operating
Financial Model where the Operating Financial Model has been updated to take into account
the relevant proposed Refinancing;
"Pre-Demolition Hard FM Charges" means the agreed sum in respect of the cost of the
provision of hard facilities maintenance work to Existing Accommodation for the Applicable
Current Residence Year being the sum of (RPI Indexed) subject to the adjustment
procedures set out in paragraph 12 of part 1 of Schedule 13;
- 53 -
"Premises" means the premises described as the Premises in the Particulars to both the
Headleases and the Underleases and includes:
(a) the foundations piles and all other load-bearing structures supporting the Premises;
(b) all additions and improvements to the Premises;
(c) all landlord's fixtures and fittings of every kind which shall from time to time be in
or upon the Premises (whether originally affixed or fastened to or upon the
Premises or otherwise);
(d) all Conduits in on under or over and exclusively serving the Premises except those
(a) belonging to a statutory undertaker or public utility; and (b) University
Infrastructure;
and references to the "Premises" in the absence of any provision to the contrary include any
and every part of the Premises;
"Premium" means the sum of payable in respect of the grant of the Phase 2 Lease
and the Long Term Leases;
"Pre-Refinancing Debt Service" means the annual debt service as shown in the Base Case
Financial Model Worksheet MA Def row 21 and Schedule 27 as payable each year;
"Pre Refinancing Equity IRR" means the Commitment IRR, as shown in the Operating
Financial Model immediately prior to the inclusion of the relevant proposed Refinancing;
"Primary Period" has the meaning given to that expression in the Senior Lenders' Direct
Agreement; means the period commencing on the Effective Date and expiring on the
expiration of 38 years from the Effective Date;
"Primary Period Arrangements" has the meaning given to that expression in the Senior
Lenders' Direct Agreement;"Primary Period Termination Notice" has the meaning given to
that expression in the Senior Lenders' Direct Agreementmeans the contractual
arrangements set out in the Project Documents which apply during the Primary Period;;
"Priority Category" means one of the four categories determining the seriousness of an NCI
or an Event of Unavailability set out in columns 1 and 2 of Table A Part 3 of Schedule 13 (the
University Accommodation Charge and Performance Measurement System);
- 54 -
"Proceeds Account" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Prohibited Act" means:
(a) offering giving or agreeing to give any employee of the University any gift or
consideration of any kind as an inducement or reward for:
(i) doing or not doing (or for having done or not having done) any act in relation
to the obtaining or performance of any of the Project Documents with the
University; or
(ii) showing or not showing favour or disfavour to any person in relation to the
Project Documents;
(iii) entering into any of the Project Documents with the University in connection
with which commission has been paid by Project Co or on its behalf or to its
knowledge unless before the relevant contract is entered into particulars of any
such commission and of the terms and conditions of any such contract have
been disclosed in writing to the University; or
(b) committing any offence in relation to the Project Documents:
(i) under the prevention of Corruption Acts 1889-1916;
(ii) which amounts to an offence in respect of fraudulent acts or omissions under

any Legislation;
(iii) at common law in respect of fraudulent acts in relation to the Project

Documents; or
(c) defrauding or attempting to conspire to defraud the University;
"Project" means the project pursuant to which Project Co has agreed to design, construct,
and finance the Accommodation and the Piazza and maintain the Accommodation and the
University has agreed to lease and leaseback the same from the Project Co or, as the context
may require, all duties and obligations of Project Co to be performed under the Project
Documents and Project Co's performance of them;
- 55 -
"Project Annual Debt Service Cover Ratio" has the meaning given to that expression in the
"Project IRR" means the post tax Project IRR as shown in the Project
Summary page of the Base Case Financial Model;
"Project Co Accommodation" means the buildings and facilities resulting from completion
of each Phase of the Works including the Retail Space, Social Space and Academic Space;
"Project Co Accommodation Equipment" means equipment which is required to be

provided by Project Co in accordance with the Works Specification in order to satisfy the
Works Completion Conditions together with any equipment which replaces any such
equipment;
"Project Co Accommodation Income Shortfall" means (for any Applicable Current

Residence Year) during the Secured Loan Period or where the Work-Out Arrangements
or the University Triggered Work-Out Arrangements apply the amount (if any) by which
the Relevant Required Rent exceeds the level of Project Co Accommodation Net Income;
"Project Co Insurance Premia" means the Financial Model Insurance Cost payable by
Project Co in relation to the insurances required to be maintained pursuant to Clause 53 and
Schedule 18 of this Agreement as adjusted pursuant to the provisions of paragraph 10 of part 1
of Schedule 13;
- 56 -
"Project Co Intellectual Property" means any Intellectual Property (other than that in the
Project Software) created other than specifically for use in the Project which is owned by
Project Co or a Consortium Member;
"Project Co Operations" means the performance of and compliance with all the obligations
of Project Co under the Project Documents including the activities to be carried out by Project
Co under the Project Documents in connection with the preparation for or carrying out of the
Works, the carrying out of any Variation and the management and provision of the Services;
"Project Co Operating Costs" means the costs shown in the Base Case Financial Model
Worksheet MA Def Row 40 in relation to the proper running of Project Co and Holdco as
adjusted pursuant to the provisions of this Agreement to reflect any Cost Change, such cost at
the Effective Date being that set out in Schedule 27 and such costs as at the Phase 4
Effective Date being that set out in Schedule 27A;
"Project Co Party" has the meaning given to it in Paragraph 1.1 of Schedule 21 of this
Agreement (Indemnities);
"Project Co Software" means software created other than specifically for use in the Project
which is owned by Project Co and used in the design, construction, commissioning or testing
of the Works, the management and provision of the Project Co Accommodation or the
conduct of Project Co Operations;
"Project Co Termination Amount" has the meaning given to that expression in paragraph
1.4.1 of Part B of Schedule 20;
"Project Co's Project Director" means the person or entity appointed by Project Co from
time to time and referred to in Clause 76 (Advisers and Representatives);
"Project Co's Proposals" means Project Co's proposals in response to the Output Brief, a
copy of which is referred to at Schedule 8 to this Agreement and attached as an Agreed Form
Document and in relation to Phase 3 and Phase 4 subject to the Derogations Schedule and
as the same may be developed, modified or varied in accordance with the Design
Development Procedure and in relation to Phase 3 subject to the Derogations Schedule4;
"Project Co's Solicitors" means Addleshaw Goddard of 25 Cannon10 Noble Street London
EC4N 6NP2V 7JW (for the attention of Adrian Collins);
"Project Co Vacation Fee" has the meaning given to that expression in Schedule 15;
- 57 -
"Project Documents" means the documents listed in Schedule 23 (List of Project
Documents) to this Agreement;
"Project Intellectual Property" means any Intellectual Property (other than that in the
Software) created specifically for use in the design, construction, commissioning or testing of
the Works, the management and provision of the Accommodation or the conduct of Project
Co Operations;
"Project Procedures Manual" means the works related procedures manual set out in
Schedule 2 to this Agreement;
"Project Software" means software developed and owned by Project Co specifically for use
in the design, construction, commissioning or testing of the Works, the management and
provision of the Accommodation or the conduct of Project Co Operations;
"Property" means each of SW Campus Phase 3 and Phase 4;
"Proposed Further Rooms" means the number of Rooms for which consent is requested in
the Request Notice;
"Proposed Room Reduction" means the University's details of and proposed arrangements
for removing Rooms from the Non-Core Accommodation as set out in the schedule to the
applicable Room Reduction Notice;
"Proposed Transaction" means any proposed Major Disposal and/or any proposed Merger;
"Proposed Transaction Data" has the meaning given to that expression in Clause 44.7;
"Proposer" has the meaning given to it in Schedule 16 (Variations) of this Agreement;
"Qualifying Change in Legislation" means either a CAPEX Change in Legislation or a

Discriminatory Change in Legislation;
"Qualifying Variation" means any Variation (including a Demand Sustaining Variation or a

Demand Increasing Variation) other than a Variation required in order to ensure compliance
with a Change in Legislation;
- 58 -
"Quality Management Plan" means a plan for implementation of the Quality Management
System;
"RC Test Date" means the date of the applicable Request Notice;
"Reacting Party" has the meaning given to it in Schedule 16 (Variations) of this Agreement;
"Rectification Plan" means a written plan of activities proposed to be undertaken by Project

Co to remedy the failure to deliver a Service;
"Rectified" means:
(a) in respect of an NCI, that the requirements of the Output Specification have been
complied with in respect of that NCI; or
(b) in respect of an Event of Unavailability, the Event of Unavailability has ceased,
and "Rectify" and "Rectification" shall be construed accordingly;
"Refinancing" means any variation, amendment, supplement or novation of any of the

Financing Agreements after Financial Close, the repayment of Senior Debt and/or the
refinancing of the Project whether by a new borrowing (and whether or not for a longer term
than the term of the original Senior Debt) or an issue by the Project Co of bonds or any other
arrangement entered into by or on behalf of Project Co with Senior Lenders in relation to the
Project not taken into account in the Operating Financial Model or the Financing Agreements
at the Effective Date which, whether independently or in combination with any other event
and directly or indirectly has or will have the effect of:
(a) changing the margin or the coupon or the effective rate of interest payable by Project
Co on the Senior Debt to enable it to carry out its obligations in connection with the
Project;
(b) postponing the date for repayment of any principal amount of the Senior Debt;
(c) increasing the amount of Senior Debt outstanding at any time;
(d) changing the dividend lock up cover ratios referred to in the Financing Agreements;
or
- 59 -
(e) changing any sums required to be paid into reserve accounts referred to in the
Financing Agreements;
but shall not include any Rescue Refinancing;
"Refinancing Certificate" means a certificate delivered to the University in accordance with

Clause 46.5 of this Agreement;
"Refinancing Headroom" means an annual amount in respect of debt service of

for each period of twelve months (and pro rata for any period of less than twelve months)
from the date the Refinancing is entered into until the date which is 38 years from the
Effective Date (including, for the avoidance of doubt, any years in which the Pre-Refinancing
Debt Service amount is shown in the relevant cell as a nil amount);
"Relevant Aggregate Net Rental Income Amount" means (for the Applicable Current
Residence Year) the aggregate of Project Co Accommodation Net Income and URA Net
Rental Income;
"Relevant Assumptions" means (for the Applicable Current Residence Year) the Economic
Assumptions, the Technical Assumptions and the other modelling assumptions (including
inputting the applicable University Data) made when running the Operating Financial Model
in accordance with paragraph 4 of Part 1 of Schedule 13 such assumptions to be in accordance
with the provisions of Schedule 11 of the Secured Term Facilities Agreement;
"Relevant Authority" means any court with the relevant jurisdiction and any local, national
or supra-national agency, inspectorate, minister, official or public or statutory person of the
Government or of the European Union;
- 60 -
"Relevant Required Rent" means during the Primary Period only and any Following
Period the rental amount for the Applicable Current Residence Year which is necessary in
order to meet the Base Case Requirements;
"Relevant Residential Agreement" means an agreement after the date of this Agreement
with any party for the construction and/or use and/or nomination and/or availability of
Residential Accommodation PROVIDED THAT (for the avoidance of doubt) Rooms within
the University Residential Accommodation which are in existence as at the Effective Date for
Students whose primary base is the Lancaster University Campus and any repair or
refurbishment undertaken by the University of such Rooms shall be disregarded for these
purposes;
"Relevant Sub-Contractor" has the meaning given to it at paragraph 6.3 in Part 2 of

Schedule 22 of this Agreement (Liaison and Disputes Resolution Procedure);
"Relevant Test Period" has the meaning given to that expression in the Secured Term
"Relevant Transfer" means a relevant transfer within the meaning of the Transfer of
Undertakings (Protection of Employment) Regulations 1981 ("TUPE") or the Acquired
Rights Directive 77/187;
"Relief Event" means any of:
(a) fire, explosion, lightning, storm, tempest, flood, bursting or overflowing of water
tanks, apparatus or pipes, earthquakes, riot, civil commotion and ionising radiation
other than ionising radiation caused by an event of Force Majeure;
(b) failure by any statutory undertaker, utility company, local authority or other like body
to carry out works or provide services;
(c) any accidental loss or damage to the development or any roads servicing it;
(d) any failure or shortage of power, fuel or transport;
(e) any blockage or embargo;
(f) any official or unofficial strike, lockout go slow or other dispute generally affecting
the building maintenance or facilities management industry or a significant sector of it
- 61 -
for the avoidance of doubt this shall not include where the Site only is affected or
where only Project Co staff are affected;
(g) a Change in Legislation other than a Qualifying Change in Legislation and/or a

Foreseeable Change in Legislation;
but only to the extent that the same or the effect of the same does not arise from any wilful
default or wilful act of Project Co and/or any Contracting Associate;
"Remediable Default" means, as appropriate, either an Event of Project Co Default which

falls within limb (f) or (g) of that definition or the University Default Event set out in Clause
49.6.1(b);
"Remediation Notice" means a notice served by either party on the other specifying:
(a) the Remediable Default; and
(b) requiring either:
(a) Project Co or the University (as appropriate) to put forward a reasonably

acceptable programme (a "Remediation Programme") within 40 Working
Days after the date of service of the Remediation Notice for remedying the
Remediable Default; or
(b) where capable of such remedy within such timescale the relevant Event of
Project Co Default or University Default Event (as appropriate) to be
rectified within 40 Working Days after the date of service of a Remediation
Notice;
"Remedy Programme" has the meaning given to it in the Senior Lenders' Direct Agreement;
"Rental Benchmarking" means the process referred to in paragraph 4 of Schedule 12

(Administration Arrangements and Allocations Policy) of this Agreement for validating the
Nominated Room Rates charged or proposed to be charged for the Accommodation by
comparing the Nominated Room Rates with the room rates charged for comparable
accommodation at Comparable Universities;
"Rental Benchmarking Report" has the meaning set out in paragraph 4.2 of Schedule 12
(Administration Arrangements and Allocation Policy) of this Agreement;
- 62 -
"Rental Comparator" means accommodation equivalent to the Accommodation in the
Comparable Universities being provided to students with services being provided to an
equivalent standard to the Services and the Soft FM Services;
"Rental Floor" has the meaning given to it in Schedule 14 (Ground Rent);
"Representative" means a representative of the Project Co who has been approved by the
Senior Lenders;
"Request Notice" means a notice substantially in the Agreed Form and issued to Project Co
and to the Senior Lenders by the University in accordance with the provisions of Clause 67.3;
"Required Period" means the duration of a period set out at Schedule 4 (Required Periods);
"Required Utilities Capacity" means the Utilities capacity required for Project Co
Accommodation:
(i) in relation to mechanical and electrical supplies as shown on the Beverley Clifton
Morris Drawing Number 10112/0500/Rev 4 which forms part of Project Co's
Proposals; and
(ii) in relation to foul drainage 36 litres per second;
"Rescue Refinancing" means any refinancing, rescheduling or restructuring permitted under

the terms of the Project Documents undertaken by or on behalf of the Senior Lenders where
either an Event of Default or Potential Event of Default (as both terms are defined under the
Financing Agreements has occurred) and where the refinancing is undertaken to address or
remedy such Event of Default or Potential Event of Default;
"Residence Term" means the three terms in a Residence Year and commencing in
September January and April in each Residence Year the length of each term to be determined
by the University, but subject to the provisions of Schedule 12 (Administration Arrangements
and Allocations Policy) of this Agreement);
"Residence Term Payment" has the meaning given to that expression in paragraph 2.1 of
Part 1 of Schedule 13;
- 63 -
"Residence Year" means each period of 12 calendar months starting in September provided
that the first Residence Year shall commence on the Effective Date and the last Residence
Year shall begin in the September immediately preceding the Term Expiry Date;
"Residence Year 2005" means the Residence Year commencing in September 2005;
"Residence Year 2006" means the Residence Year commencing in September 2006;
"Response Period" has the meaning given to it in Schedule 16 (Variations) of this

Agreement;
"Response Time" means in relation to an NCI or Event of Unavailability which is classified

as within one of Priority Categories 1–4, the time period set out in columns 4 to 7 (inclusive)
of Table A contained in Part 3 of Schedule 13 (the University Accommodation Charge and
Performance Measurement System) of this Agreement within which Project Co is required to
take the action specified in Table A;
"Residential Accommodation" means residential accommodation of any type made

available by a member of the University Group to Students including (without limitation):-
(a) halls of residence on the Lancaster University Campus;
(b) accommodation blocks and complexes comprised of houses and flats with self-
catering facilities owned or leased by members of the University Group; and
(c) accommodation made available through property rental schemes entered into by
members of the University Group with individual students and families;
"Restricted Period" means the period of 5350 years from the Phase 4 Effective Date;
"Restricted Period Expiry Date" means the earlier of (1) the date occurring on the
expiration of the Restricted Period and (2) the date on which all Senior Debt Sums are repaid
in full;
"Retail Space" means that part of the Ground Floor of County Main which following
completion of the Phase 4 Works will be utilised by the University for retail purposes;
"Reversionary Interest" means the interest immediately reversionary to the determination of

the Headleases;
- 64 -
"Reviewable Design" means the following detailed design proposals which shall be subject
to the Design Development Procedure:
(a) 1:20 room layout drawings for all social areas/facilities showing all fixed areas and
structural information affecting space planning, room layout and services affecting
the use of floor plates together with room data sheets detailing, inter alia, electrical
socket outlets and other such service connections;
(b) Schedule of finishes for all social facilities/areas identifying the locations, colour,
choice of quality of materials, finishes and fittings (such as floor, ceiling and wall
coverings and electrical fittings, ironmongery and sanitary fixtures and fittings) with
samples and drawings as appropriate including insofar as they relate to the Sample
Rooms;
(c) 1:200 external works general arrangement drawings (including security requirements,
landscape areas and utility and communications supplies);
(d) internal and external signage; and
(e) all design proposals relevant to the satisfaction of planning conditions/reserved

matters in respect of the Works which have not been satisfied at the date of this
Agreement;
"Rights in Respect of Land" means any right over or in respect or otherwise relating in any
way to land, whether temporary, revocable, legal, equitable or otherwise of whatever nature;
"Room" means an individual room designed for use as a study bedroom within the Campus
Accommodation;
"Room Reduction Notice" means a notice substantially in the Agreed Form and issued to
Project Co and to the Senior Lenders by the University in accordance with Clause 66.3;
"RPI" means the Retail Prices Index (all items) as published by the Office for National
Statistics from time to time or, failing such publication, such other index as may replace or
supersede the same or, in the absence of a replacement or superseding index, such other
appropriate index as the parties may agree or failing agreement, as may be determined
pursuant to the Liaison and Disputes Resolution Procedure;
- 65 -
"RPI Indexed" means, in relation to a figure, that that figure is to be adjusted on 1st October
each year in line with the ratio of RPI published for the September immediately preceding that
date to the RPI published for September 20022007;
"RR-X" means "X" Working Days prior to the date on which the Proposed Reduction is to be
effected;
"Running Room Total" means the qualifying number of Rooms comprised in the Campus
Accommodation from time to time (rounded to the nearest whole number) for the purposes of
the Applicable Tests being the aggregate of (1) the actual number of Rooms within the
Campus Accommodation (2) the number of Proposed Further Rooms for which consent
pursuant to a Request Notice has been given and for which the University has entered into a
Relevant Residential Agreement and (3) the Added Room Factor;
"S&P" means Standard and Poor's Ratings Services, a division of McGraw-Hill Companies,
Inc.;
"Sample Rooms" means the sample standard bedroom and standard kitchen which (in each
case the reference to "standard" being as opposed to "disabled") sets out the benchmark level
of quality, fixtures and fittings to be used in determining whether (to the extent relevant to
quality fixtures and fittings only) the Works Completion Conditions have been satisfied;
"Satisfaction Date" means the date upon which the House 14 Condition is satisfied;
"SD + Y" means "Y" Working Days after the relevant Statement Date;
"Secondary Period" means the period commencing on and including the Secondary
Period Commencement Date and expiring:
(a) in circumstances where Termination has occurred the date upon which Project
Co has received payment of the Applicable Termination Sum (whether as a
single payment or by way of instalments) pursuant to the provisions of Schedule
20 of the Master Agreement; and
"Secondary Period" has the meaning given to that expression in the Senior Lenders' Direct
Agreement;
(b) in circumstances where Termination has not occurred on the Term Expiry Date;
- 66 -
"Secondary Period Commencement Date" has the meaning given to that expression in the
Senior LendersLender's Direct Agreement;
"Secondary Period Decision Notice" has the meaning given to that expression in the Senior
Lenders' Direct Agreement;
"Secondary Period (Non Default) Arrangements" means the contractual arrangements
set out in this Agreement which apply during the Term following the Secondary Period
Commencement Date but which do not apply where there has been a Termination
during the Primary Period or where either the Work-Out Arrangements or the
University Triggered Work-Out Arrangements apply (as appropriate));
"Secondary Period (Non Default) Instalment Arrangements" has the meaning given to
that expression in Part F1 of Schedule 20;
"Secondary Period Work Out Arrangements" has the meaning given to that expression in
the Senior Lenders' Direct Agreement;"Secondary Period Work Out Termination Date"
has the meaning given to that expression in the Senior Lenders' Direct Agreement;
"Section" means all or any of Section 1, Section 2 or Section 3Section 2A or in the case of
the Phase 4 Works any of the County Field Blocks A-E Works, the County Field Block F
Works, the Grizedale Works the County Main Works or the County West Demolition
and Piazza Works and "relevant Section" shall be construed accordingly;
"Section 1 Works" means Blocks 31, 32 and 33 and all other works comprising part of the
Phase 3 Works shown in the Construction and Phasing Plans as forming part of Section 1;
"Section 2 Works" means all those Phase 3 Works other than the Section 1 and include for
the avoidance of doubt Section 2A;
"Section 2A Works" means that part of the Phase 3 Works comprising the demolition of
Inner Fylde and all other works comprising part of the Phase 3 Works shown on the
Construction and Phasing Plan as forming part of the Section 3 Works;
"Secured Loan Period" has the meaning given to that expression in the Senior Lenders'
Direct Agreement;
"Secured Loan Period Arrangements" has the meaning given to that expression in the
- 67 -
"Secured Loan Period Termination Notice" has the meaning given to that expression in
"Secured Term Facilities Agreement" means the agreement so titled dated 12 September
2003 2007 and made between (amongst others) Project Co (1) Holdco (2) Barclays Bank plc
(3) and The Royal Bank of Scotland plc (4) Dexia Credit Local, London Branch (3) Dexia
Management Services Limited and (4) various financial institutions (5) and The Governor
and Company of the Bank of Ireland (6);
"Security Trust and Intercreditor Deed" has the meaning given to that expression in the
"Security Trustee" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Sector Adverse Change" means any event or matter which has occurred since the Effective
Date which it is agreed or determined would have a material adverse effect on the present or
future financial condition of providers of higher education courses or their ability to perform
obligations of the type contained in the Project Documents or the proposed Relevant
Residential Agreement or agreements similar or equivalent thereto (as applicable) such that no
prudent higher education provider would enter into an agreement of the type proposed;
"Senior Debt No Default Rate" means the rate at which interest will accrue on a Term Loan
pursuant to Clause 7.1 (Calculation of Interest) of the Secured Term Facilities Agreement;
"Senior Debt Sums" has the meaning given to that expression in the Senior Lenders' Direct
Agreement;
"Senior Lenders" means any person providing senior debt finance or hedging arrangements
to Project Co under the Financing Agreements;
"Senior Lender's Direct Agreement" means the agreement so titled made on or about the
Effective Date between the University,; the Facility Agent, the Security Trustee, the Account
Bank, Holdco and Project Co;
"Senior Representatives" has the meaning given to it in paragraph 2.1 of Part 2 of Schedule
22 (Liaison and Disputes Resolution Procedure) of this Agreement;
- 68 -
"Service Deductions" means the deductions which the University is entitled to make from
the University Accommodation Charge for poor performance of the Services calculated in
accordance with Part 5 of Schedule 13 (the University Accommodation Charge and
"Service Level" means the standards for individual elements of the Services to be complied
with by Project Co as set out in column 2 of Appendix 1 to Schedule 13;
"Service Prohibited Materials" means any materials which are themselves or which
incorporate substances generally known within the facilities management industry at the time
of use to be dangerous or hazardous to health and safety or deleterious to the fabric of the
Project Co Accommodation in the particular circumstances in which they are used or which
are otherwise not in accordance with Legislation, British standards, codes of practice or good
building practice or techniques at the date of use (as determined by reference to the COSHH
regulations (or any revised version thereof) at that date);
"Service Variation" means any change or variation to the Output Specification but excluding
any change or variation already contemplated by and dealt with in the Output Specification;
"Services" means the Hard FM Services and the Additional Services (as they may from time
to time be varied pursuant to any Variation) and "Service" shall be construed accordingly;
"Settlement Agreement" has the meaning given to it in Part 2 of Schedule 22 (Liaison and
Disputes Resolution Procedure) to this Agreement;
"Shareholders" means Jarvis PlcUPP Investments Limited and the Alma Mater Fund
Limited Partnership;
"Shareholders Agreements" means the documents referred to in paragraph 1.4 of Schedule

4;
"Short Term Underleases" means together the Cartmel Short Term Underlease, the County
Short Term Underlease, the Furness Short Term Underlease, the Fylde Short Term Underlease
and the Grizedale Short Term Underlease and "Short Term Underlease" and "Relevant
Short Term Underlease" shall be construed accordingly;
"Short Term Underlease Termination Date" means the date upon which the relevant Short
Term Underlease automatically ceases and determines pursuant to Clause 7.3.1 of the relevant
Short Term Underlease;
- 69 -
"Sinking Fund" means at any time the aggregate of the Sinking Fund Contribution less
payments properly made pursuant to the Hard FM Contract;
"Sinking Fund Contribution" means the amount shown for each Residence Year during the
Term as being payable into the Maintenance Reserve Account (as that expression is defined in
the Secured Term Facilities Agreement) as shown in the Base Case Financial Model
Worksheet MA Def Row 43 (RPI Indexed) for the purposes of lifecycle repair and
maintenance of the Project Co Accommodation and as set out in Schedule 27;
"Site" means the area upon which the Accommodation is situate;
"Snagging Matters" has the meaning given to it in Clause 38.1.2 of this Agreement;
"Snagging Notice" has the meaning given to it in Clause 38.1.3 of this Agreement;
"Social Space" means that part of the Ground Floor of County Main which will
following the Completion of the Phase 4 Works be utilised for social use by Students and
as more particularly shown in the Construction and Phasing Plans;
"Soft FM Services" means the services provided by the University to the Students who have
entered into Student Residence Agreements for the Accommodation as set out in Annexure 5;
"Soft FM Service Levels" means the standard to which the University is obliged to provide
or procure the provision of the Soft FM Services to the Students as set out in Annexure 5; and
in relation to the town houses comprised within Grizedale and County Field as set out in
Annexure 5A;
"Software" means Project Co Software and the Project Software;
"Specification" means the Output Specification and the Works Specification;
"Specified Base Case Ratios" means the specified figures in the Operating Financial Model
for each of the Debt Ratios;
"Specified Criteria" means the criteria set out in Clause 66.3.1;
"Standard Commercial Property Conditions" means the Standard Commercial Property

Conditions (First Edition) and "SCPC" means Standard Commercial Property Condition;
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"Statement Date" means the date on which the University supplies Project Co with the
Income, Expenditure and Occupancy Statement pursuant to paragraph 3.1 of Part 1 of
Schedule 13;
"Student" means any person enrolled or to be enrolled as a student (whether undergraduate

or post-graduate) of the University or as a student of a higher or further educational institution
(including any such person enrolled as a post-graduate student) and includes any person who
enters into a Student Residence Agreement;
"Student Handbook" means the handbook for students and non-residents as described in
paragraph 8.5.4 of Schedule 12 (Administration Arrangements and Allocation Policy);
"Student Residence Agreement" means the agreement to be entered into by each person
who is to reside at the Accommodation or the University Residential Accommodation other
than a Vacation Use Agreement including for the avoidance of doubt Students and any
spouses of Students (whether or not themselves a Student) and which shall include any
agreement entered into by a Student entitling the Student (and any spouse or family of
that Student (whether or not themselves a Student)) to use a Room solely during a period
outside of the Letting Period for that Room and which shall be in the form attached at
Annexure 6 to this Agreement or in such other form as the University and Project Co shall
agree from time to time (such agreement not to be unreasonably withheld or delayed) provided
always that:
(a) the Agreement shall be expressed to be a licence and not a tenancy;
(b) the licence fees shall be payable in advance but may be by monthly termly or
quarterly instalment;
(c) there shall be provision for payment of a damage deposit by the licensees in advance
of taking occupation;
(d) the licensee shall be subject to appropriate rules and regulations;
(e) the licence shall be personal to the licensee;
(f) the licensor shall be responsible for maintenance and running of the Accommodation
subject to reasonable limitations for force majeure;
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(g) the licence shall contain appropriate provisions for termination by the licensor;
(h) the licence shall contain provisions entitling the licensor to relocate the licensee
elsewhere in the Accommodation or the University Residential Accommodation or to
suitable alternative accommodation;
(i) the licence shall not contain any provisions relating to:
(i) Availability Deductions;
(ii) Service Deductions;
(iii) compensation for the licensee; or
(iv) entitlement of the licensee to insurance proceeds;
"Sub-Contract" means the Building Contract, the Hard FM Contract or the Employer's
Agent's Appointment and "Sub-Contracts" shall mean the Building Contract, the Hard FM
Contract and the Employer's Agent's Appointment;
"Sub-Contractor" means the Building Contractor, the Hard FM Contractor or the

Employer's Agent;
"Sub-Contractor Breakage Costs" means Losses that have been or will be reasonably and
properly incurred by Project Co as a direct result of the termination of the Project Documents
but only to the extent that:
(a) the Losses are incurred in connection with the Project and in respect of the provision
of the Services or the completion of Works, including:
(i) any materials or goods ordered or sub-contracts placed that cannot be

cancelled without such Losses being incurred;
(ii) any expenditure incurred in anticipation of the provision of Services or the

completion of the Works in the future;
(iii) the cost of demobilisation including the cost of any relocation of equipment
used in connection with the Project;
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(iv) redundancy payments; and
(b) the Losses incurred are under arrangements and/or agreements that are consistent
with terms that have been entered into the ordinary course of business and on
reasonable commercial terms; and
(c) Project Co and the relevant Sub-Contractor has each used its reasonable endeavours
to mitigate the Losses;
"Successor Establishment" means any university or other higher education institution or

educational establishment with whom the University either proposes to or with whom the
University has effected a Major Disposal or a Merger;
"Superior Landlord" means the person for the time being entitled to the reversion
immediately expectant on the determination of the Head Lease;
"Supplemental Lease" means the Supplemental Lease of parts of the Phase 1 to be granted
pursuant to clause 4.1 such lease being in Agreed Form;
"SW Campus" means Phase 1 and Phase 2 in aggregate;
"SW Campus Lease Contractual Completion Date" means in relation to the Phase 2 Lease
and the Deed of Variation the later of:
(a) the Effective Date; and
(b) the Working Day next following date on which a court of competent jurisdiction
authorises an agreement excluding in relation to the Phase 2 Lease or the Deed of
Variation (as appropriate) the provisions of sections 24 to 28 of the Landlord and
Tenant Act 1954;
"SW Campus Leases" means together the Phase 1 Lease and the Phase 2 Lease and the
Supplemental Lease and "SW Campus Lease" shall be construed accordingly;
"SW Campus Underlease Contractual Completion Date" means:
(a) in relation to the Phase 1 Underlease the tenth Working Day next following the later
of (i) the Phase 1 Works Completion Date; and (ii) the date on which a court of
competent jurisdiction authorises an agreement excluding in relation to the Phase 1
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Underlease the provision of sections 24 to 28 of the Landlord and Tenant Act 1954;
and
(b) in relation to the Phase 2 Underlease the tenth Working Day next following the later
of (i) the Phase 2 Works Completion Date; and (ii) the date on which a court of
competent jurisdiction authorises an agreement excluding in relation to the Phase 2
Underlease the provisions of sections 24 to 28 of the Landlord and Tenant Act 1954.
"SW Campus Underleases" means together the Phase 1 Underlease and the Phase 2A
Underlease and the Phase 2B Underlease and "SW Campus Underlease" shall be
"Target Date for Phase 1 Completion" means 30 September 2003 as extended by a period
equivalent to all extensions of time granted pursuant to Clause 34 (Extensions of Time);
"Target Date for Phase 2A Completion" means 25 September 2004 as extended by a period
"Target Date for Phase 2B Completion" means 31 December 2004 as extended by a period
"Target Date for Phase 3 Completion" means in respect of Section 1 - 30 June 2006 and in
respect of Section 2 - 15 September 2006 (in each case) as extended by a period equivalent to
all extensions of time granted pursuant to Clause 34 (Extensions of Time);
"Target Date for Phase 4 Completion" means (where the provisions of clause 52.7 apply)
29 September 2007i) 1 December 2007 in respect of County Field Blocks A-E; (ii) 21
December 2007 in respect of County Field Block F (iii) 30 June 2008 in respect of
Grizedale and 27; (iv) 1 September 2008 in respect of the County such later date as may be
derived from (1) an extension of time pursuant to Clause 34 (Extensions of Time) or (2) as
may be agreed between the parties (acting reasonably) where there has been a delay in
agreeing: (a) whether the Phase 4 Works Condition Precedent and the Phase 4 Financing
Conditions Precedent have been satisfied or (b) where they have been satisfied, the Operating
Financial Model and/or any changes to the Project Documents or (c) any delay in securing the
approval of the University Council under clause 52.10 (3) where the provisions of clause 52.8
apply 29 September 2008 in respect of Grizedale and 27 September 2009 in respect of
CountyMain Works and (v) 21 December 2007 in respect of the County West Demolition
and Piazza Works in each case as extended by a period equivalent to all extensions of
time granted pursuant to Clause 34 (Extension of Time);
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"Target Date for Phase Completion" means any or all of the Target Date for Phase 1 Works
Completion, Target Date for Phase 2A Works Completion, Target Date for Phase 2B Works
Completion, Target Date for Phase 3 Works Completion and (where the provisions of Clause
52.7) apply the Target Date for Phase 4 Works Completion and "relevant Target Date for
Phase Completion" shall be construed accordingly;
"Tax" means any kind of tax, duty, levy or other charge (other than VAT) whether or not
similar to any in force at the date of this Agreement and whether imposed by a local,
governmental or other Relevant Authority in the United Kingdom or elsewhere but shall not
include any corporation tax payable by the Project Co directly attributable to the reduction or
loss of short lease premium relief from that shown as accruing to Project Co in the Base Case
Financial Model;
"Technical Assumptions" has the meaning given to that expression in the Secured Term
"Temporary Fix" has the meaning given to it in paragraph 3.1 of Part 3 of Schedule 13 (the
University Accommodation Charge and Performance Measurement System) of this
Agreement;
"Term" means the term of 48 years from the Effective Date;
"Term Expiry Date" means the date of expiry of the Term by effluxion of time;
"Termination" means the termination of the Primary Period Arrangements and the
Secondary Period (Non Default Arrangements) in respect of the Project Documents in
accordance with either this Agreement or the Senior Lender's Direct Agreement (as
applicable);
"Termination Date" means the date upon which Termination occurs;
"Test Date" has the meaning given to that expression in the Secured Term Facilities
Agreement;
"Tests on Completion" means the tests set out at Schedule 3 (Tests on Completion) to this
Agreement;
"Third Party Claims" means a claim brought by way of court proceedings by a third party;
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"Third Party Intellectual Property" means any Intellectual Property (other than that in the
Software) created other than specifically for use in the Project which is owned by a third party
who is not a Contracting Associate and is used in the design, construction, commissioning or
testing of the Works, or the management and provision of the Project Co Accommodation;
"Title Matters" means the matters contained or referred to in the Certificates of Title;
"Total Annual Debt Service Cover Ratio" has the meaning given to that expression in the
"Total Loan Life Cover Ratio" has the meaning given to that expression in the Secured
Term Facilities Agreement;
"Townhouses" means those units of accommodation forming part of the County Field
Blocks A-E Works, the County Field Block F Works and the Grizedale Works
comprising townhouses and more particularly identified as such on the Construction and
Phasing Plans;
"Traffic Management Plan" means a traffic management plan which is to be agreed

between the University and Project Co in relation to each Phase of the Works or otherwise
determined under the Liaison and Disputes Resolution Procedure in accordance with
paragraph 2.8.2 of Schedule 2 (Project Procedures Manual);
"Transaction" means any Major Disposal and/or any Merger;
"Transaction Conditions" means the conditions specified in Clause 44.6;
"Transaction Forecast Period" has the meaning given to that expression in Clause 44.6.3;
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"Uncertified Title Matters" means in relation to County Field only any encumbrances
which affect County Field or the University's title to County Field which have not been
disclosed in the Certificate of Title and which are unknown to Project Co or any Project
Co party;
"Underleases" means the SW Campus Underleases and the Long Term Underleases and
"relevant Underlease" and "Underlease" shall be construed accordingly
"Underlease Term" means the term granted in relation to the relevant Underlease;
"Underlease Termination Date" means the date on which termination of the Underlease
takes effect in accordance with its terms;
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"Underlease Term Expiry Date" means the date on which the tenancy granted by the grant
of the Underlease Term ends by effluxion of time;
"Uninsurable" means in relation to any risk that Project Co is required to take out insurance
against under any of the Project Documents and any risk which the University is required to
take out insurance against in relation to the University Residential Accommodation that:
(a) insurance is not available to Project Co or, where appropriate, the University in
respect of that risk in the worldwide insurance market with an insurer of good repute
on substantially the same terms as required by the terms of the Project Documents; or
(b) the reasonable and proper insurance premium available in the worldwide insurance
market that is payable for insuring that risk is at such a level that the risk is not
generally being insured against in the worldwide insurance market with reputable
insurers of good repute;
"University" means the University of Lancaster;
"University Accommodation Charge" means the total rent payable by the University to the
Project Co pursuant to the Underleases which sum is calculated pursuant to the provisions of
of this Agreement;
"University Alternative Accommodation" has the meaning given to it in paragraph 6.1.1 of

"University Authorised Personnel" means:
(a) any persons employed or engaged by the University (including but not limited to
University staff) and/or its subcontractors of any tier and its or their directors officers
employees; and/or
(b) any person present on the Site with the express authority of the University without
Project Co's prior consent;
"University Data" has the meaning given to that expression in paragraph 3.1 of Part 1 of
Schedule 13 and the expression "Applicable University Data" shall be construed
accordingly;
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"University Default Events" means those events listed in Clause 49.6 (Default by the
University entitling Project Co to terminate);
"University Following Period Decision Notice" has the meaning given to that expression
in the Senior Lenders' Direct Agreement;
"University Group" means the University and all companies or other entities in existence at
the date of this Agreement which are a subsidiary, or a subsidiary undertaking of the
University or which the University creates from time to time;
"University Material Adverse Change" means an event or matter which has occurred since
the Effective Date which it is agreed or determined would have a Material Adverse Effect if
the University were to enter into the relevant arrangements which are being proposed;
"University Party" has the meaning given to it in paragraph 1.1 of Schedule 21 (Indemnities)
of this Agreement;
"University Portion" means fifty per cent. of any Refinancing Gain;
"University Proposed Transaction Notice" has the meaning given to that expression in
Clause 44.7;
"University Residential Accommodation" means Student accommodation owned or

controlled by or on behalf of the University Group from time to time but excluding the
Accommodation and excluding any accommodation not owned or controlled by or on behalf of
the University Group as at the Effective Date (such accommodation as at the Effective Date
comprising the list of properties set out in Schedule 25);
"University Response" has the meaning given to that expression in paragraph 5 of Schedule
13;
"University Secondary Period Decision Notice" has the meaning given to that expression in
"University Sign-Off Notice" means a notice issued or deemed to have been issued by the
University in accordance with the Design Development Procedure;
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"University Termination Sum" has the meaning given to it in paragraph 1.4 of Part A of
Schedule 20 (Termination Compensation) of this Agreement;
"University Triggered Work Out Arrangements" has the meaning given to it in the
"University Up-Front Deductible Costs" means (for each Applicable Current Residence
Year) the sum of (RPI Indexed) and as adjusted pursuant to the provisions of
paragraph 12 of Schedule 13;
"University's Contract Manager" means such person as may be appointed by the University
to administer the Project on behalf of the University and as notified to Project Co from time to
time;
"University's Development Programme" means the University's programme for the

carrying out of certain building works and development in the Lancaster University Campus
during the Construction Period details of which are attached to this Agreement as Annexure 7;
"University's Function Requirements" means:
(a) the overall size of, layout of, spatial capacity of and the quality of finishes of the
Project Co Accommodation;
(b) the required functional content of the Project Co Accommodation and the
compatibility of that functional content with the uses to which the University
proposes putting the Project Co Accommodation;
(c) flexibility of the design in order to accommodate future changes in use and/or
occupation by the University;
(d) room designations, uses and layouts and the occupational densities thereof and their
interrelationships with and proximity to vending areas, rest areas, amenities,
equipment areas and electrical and IT connections;
(e) the type, quantity and quality of internal partitioning, furniture, fixtures, fittings and
finishes and office equipment within the Project Co Accommodation;
(f) any specific requirements set out in the Output Brief which are expressly stated
therein to be subject to the approval, satisfaction or agreement of the University; and
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(g) the overall layout and external appearance of the Project Co Accommodation,
but does not extend to the technical performance, performance standards or integrity of the
Works;
"University's Infrastructure" means those conduits and any other conducting media with
associated apparatus existing (subject to this definition) on any land owned or controlled by
the University and into which Project Co will procure connection of Utilities as part of the
Works including pumping stations, electricity substations, gas governor stations, balancing
reservoirs and other balancing equipment and other apparatus relating to the supply of Utilities
and the point at which these conduits become University Infrastructure (notwithstanding the
definition of the Premises) is:-
(i) the end of the supply into the distribution panel in any buildings on the
Premises in relation to electricity media
(ii) at the meters within 2 metres of the building envelope in relation to gas
media
(iii) at the stopcocks within 2 metres of the building envelope in relation to water
media
(iv) within 2 metres of building envelope in relation to drainage media
(v) the patch panel in the roof of any buildings on the Premises in relation to
telecommunications media;
"University's Solicitors" means Ashurst Morris Crisp of Broadwalk House 5 Appold Street
London EC2A 2HA (ref: ABS/HRL/LAN09.00001);
"Unplanned University Events" means those special events referred to in paragraph 2.1.3 of
Schedule 2 in relation to which the University gives Project Co not less than 20 Working Days
prior written notice, such notice to include a description of the event, the date of its occurrence
and the anticipated duration;
"Up-Front Deductions" means (for the Applicable Current Residence Year) the aggregate of
the Variable Soft FM Charge, the Fixed Soft FM Charge, the Utilities Charge (but not the
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Utilities Shortfall (if any)) and Pre-Demolition Hard FM Charges and the expression
"Applicable Up-Front Deductions" shall be construed accordingly;
"URA Net Rental Income" means (for the Applicable Current Residence Year) an amount
equivalent to the total Income receivable from the University Residential Accommodation
including any proceeds from business interruption insurance required to be taken into account
pursuant to Clause 64 (Application of Business Interruption Proceeds) less the University Up-
Front Deductible Costs as such figures are set out in the agreed (or determined in accordance
with the provisions of this Agreement) relevant Income, Expenditure and Occupancy
Statement;
"Utilities" means all services, including gas, electricity, water and mains, drainage, cable
(including fibre optic cable) and telecommunications;
"Utilities Charge" means:
(a) for the period until the Residence Year commencing in September 2007 the sum
of per Room per Residence Year (RPI Indexed) for the provision of
the Utility Supplies to the Project Co Accommodation and the sum of
per Room per Residence Year (RPI Indexed) for the provision of the Utility supplies
to the Existing Accommodation as shown in the Operating Financial Model;
(b) for the period from the Residence Year commencing in September 2007:
(i) the sum of per Room per Residence Year (RPI Indexed) in
respect of those rooms in the Project Co Accommodation situate on the
South West Campus, and Phase 3; and
(ii) the sum of per Room per Residence Year (RPI Indexed) in
respect of those Rooms in the Project Co Accommodation situate in
Phase 4 (other than Rooms in the Townhouses); and
(iii) the sum of per Room per Residence Year (RPI Indexed) in
respect of the Rooms in County Main prior to the Date of Possession in
respect of County Main
for the provision of Utilities supplies to those Rooms within the Project Co
Accommodation
"Utility Supplies" means supply of water drainage of soil and surface water electricity, gas,
telephone communications and other services;
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"Vacation Income" means the licence fees or other income payable pursuant to any Vacation
Use Agreement;
"Vacation Period" means any one or all of the periods of vacation in each Residence Year;
"Vacation Use" means summer school use conferences or other short term accommodation
requirements during the Vacation Period which for the avoidance of doubt could involveother
than lettings or licences other than to Students (or the spouse or family of a Student);
"Vacation Use Agreement" means an agreement in relation to Vacation Use satisfying each
of the following criteria:
(a) the agreement shall be expressed to be a licence and not a tenancy;
(b) the licensee shall be subject to appropriate rules and regulations;
(c) the licence shall be personal to the licensee;
(d) the licence shall contain appropriate provisions for termination by the licensor;
(e) the licence shall not contain any provisions relating to:
(i) Availability Deductions;
(ii) Service Deductions;
(iii) Compensation for the licensee to the extent that such compensation could be
recovered from the Landlord; or
(iv) Entitlement of the licensee to insurance proceeds which the Landlord

maintains;
"Variable Soft FM Charge" means the sum calculated in accordance with the provisions of
paragraph 13 of Part 1 of Schedule 13 (the University Accommodation Charge and
"Variation" means any Works Variation, Service Variation or a request by the University for
the provision of an Additional Service;
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"Variation Change in Operating Costs" means the difference between the reasonable and
proper costs to Project Co of providing the Services as varied by the Variation and the
reasonable and proper costs incurred by Project Co in providing the Services without the
Variation being implemented;
"Variation Costs" means costs reasonably and properly incurred and reasonable Losses
suffered by Project Co which arise as a direct result of a Variation being implemented but
taking into account any Cost Savings;
"Variation Enquiry" has the meaning given to it in Part 1 of Schedule 16 (Variations) of this
Agreement;
"Variation Order" has the meaning given to it in paragraph 8.1 of Schedule 16 (Variations)
of this Agreement;
"Variation Procedure" means the procedure set out in Schedule 16 (Variations) of this
Agreement;
"Variation Report" has the meaning given to it in paragraph 4.4 of Part 1 of Schedule 16
(Variations) of this Agreement;
"VAT" means value added tax as referred to in Section 1 Value Added Tax Act 1994 or any
similar tax replacing the same;
"VAT Change in Legislation" means a Change in Legislation which is not a Foreseeable

Change in Legislation which applies to VAT including, without limitation, the applicability
of, rate(s) of or exemptions from VAT and/or the regime for persons making elections to
waive exemption in relation to VAT or any successor or similar tax replacing VAT and which
shall also be deemed to include any change by Customs and Excise in their interpretation of
the definition of "solely for a relevant residential purpose" insofar as it relates to use of the
Accommodation for non student letting;
"Viable Work-Out Solution" has the meaning given to that expression in the Senior Lenders'
Direct Agreement;
"Voluntary Major Disposal" means a disposal (other than by way of Obligatory Major
Disposal) by the University or any member of the University Group of all or part of the assets
of the University Group (disregarding the Accommodation for these purposes);
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"Voluntary Merger" means a merger, amalgamation or consolidation of the University with
another university or higher education institution or educational establishment other than by
way of Obligatory Merger;
"Working Day" means any day other than:
(a) a Saturday or Sunday; or
(b) a day which is a bank or public holiday in the City of London;
"Work-Out Arrangements" has the meaning given to that expression in the Senior
"Work-Out Debt Service" has the meaning given to that expression in the Senior Lenders'
Direct Agreement;
"Work-Out Termination Date" has the meaning given to that expression in the Senior
"Works Completion Certificate" means a certificate issued pursuant to Clause 37.3 of this
Agreement in relation to a Phase of the Works and in relation to the Phase 3 Works and the
Phase 4 Works each Section;
"Works Completion Conditions" means the relevant Phase of the Works has been
completed in accordance with the Works Specification and in relation to the Phase 3 Works
and the Phase 4 Works in accordance with that part of the Works Specification applicable to
thatthe relevant Section and for the avoidance of doubt such completion shall not have been
achieved until, inter alia, the relevant Phase of the Works (or (in relation to the Phase 3 Works
and the Phase 4 Works) that relevant section) has satisfactorily passed all Tests on
Completion;
"Works" means the design, development, construction, completion, commissioning and

testing of those works (including any remediation or demolition, off-site highway works and
the connection of services) which are described in the Works Specification and any work
required as the result of a Variation to the Works instructed in accordance with this
Agreement;
"Works Completion Date" means any or all of the Phase 1 Works Completion Date, the
Phase 2 Works Completion Date, the Phase 3 Works Completion Date and (where the
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provisions of Clause 52.7 apply) the Phase 4 Works Completion Date,the Phase 4 Works
County Field Blocks A-E Completion Date, the Phase 4 Works County Field Block F
Completion Date, the Phase 4 Works Grizedale Completion Date and the Phase 4 Works
County Main Completion Date as the context so permits and "relevant Works Completion
Date" shall be construed accordingly;
"Works Payment" means the sum of
"Works Payment Works" means the elements of the Phase 4 Works in respect of which
the Works Payment is being made comprising:
(a) the new service road; and
(b) the green forming part of the Piazza
both as more particularly described in Project Co's Proposals;
"Works Programme" has the meaning given to it in paragraph 1.3 of Schedule 17 (Change
in Legislation) of this Agreement;
"Works Prohibited Materials" means any materials which are themselves or which
incorporate substances that are generally known within the construction industry at the time of
use to be dangerous or hazardous to health and safety or deleterious to the integrity or
durability of the Works (when completed) or the Project Co Accommodation in the particular
circumstances in which they are used or which are otherwise not in accordance with
Legislation, British Standards, codes of practice or good building practice or techniques as at
the date of use (as determined, inter alia, by reference to the 1997 Ove Arup & Partners'
publication entitled "Good Practice in the Selection of Construction Materials" (or any revised
version thereof at that date) and other relevant publications at that date of the Building
Research Establishment);
"Works Specification" means the Output Brief and Project Co's Proposals;
"Works Variation" means any change or variation requested or required to the Works
Specification, save to the extent that such change or variation is already contemplated by and
dealt with in Project Co's Proposals;
2. CONSTRUCTION AND INTERPRETATION
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Save to the extent that the context or the express provisions of the relevant Project Documents
otherwise require:
2.1 headings and sub-headings are for ease of reference only and are not to be taken into
consideration in the interpretation or construction of the Project Documents;
2.2 references in this Agreement to any Clause or Sub-Clause or Schedule or Appendix or

Annexure without further designation shall be construed as a reference to the Clause or Sub-
Clause of or Schedule or Appendix or Annexure to this Agreement. Reference to a paragraph
within a Schedule shall without further designation be construed as a reference to a paragraph
in that Schedule;
2.3 this Agreement and the other Project Documents shall be construed and interpreted as a whole
provided that in the event of any conflict or inconsistency between the provisions of the main
body (and the Schedules) of any Project Document and any Appendices of any Project
Document then the provisions of the main body (and the Schedules) shall prevail to the extent
of any such conflict or inconsistency and in the event of any conflict or inconsistency between
the Project Documents the terms of this Agreement shall prevail;
2.4 if there is any conflict or inconsistency between the terms of the Project Documents and/or
any documents in Agreed Form then, in determining the rights and liabilities of the Parties, the
provisions of the Project Documents shall prevail over and have effect in place of the relevant
provisions of the relevant documents in the Agreed Form;
2.5 the Schedules and appendices to the Project Documents are an integral part of the Project
Documents and reference to any Project Document includes reference thereto;
2.6 save as otherwise expressly stated, all references to agreements, documents or other
instruments include (subject to all relevant approvals) a reference to that agreement, document
or instrument as amended, supplemented, substituted, novated or assigned from time to time;
2.7 all references to any statute or statutory provision or regulation include reference to any statute
or statutory provision or regulation which amends, extends, consolidates or replaces the same
or which has been amended, extended, consolidated or replaced by the same and shall include
any orders, regulations, codes of practice, instruments or other subordinate legislation made
under the relevant statute or statutory provision;
2.8 any reference to time of day is a reference to London time;
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2.9 the words "herein", "hereto" and "hereunder" refer to the Project Documents as a whole
and not to the particular Clause, Schedule, part, section, paragraph, annex or appendix in
which such word may be used;
2.10 "person" includes any individual, partnership, firm, trust, body corporate, government,
governmental body, authority, agency or unincorporated body of persons or association;
2.11 any reference to a public organisation shall be deemed to include a reference to any successor
to such public organisation or any organisation or entity which has taken over the functions or
responsibilities of such public organisation;
2.12 references to "Party" means a party to this Agreement and a reference to "the University",
"Project Co", "Party" or the "Parties" shall, unless the context otherwise requires, be
construed so as to include their respective successors and permitted assigns;
2.13 all monetary amounts are expressed in pounds sterling;
2.14 references to the word "includes" or "including" are to be construed without limitation;
2.15 references to "sub-contractors" and "sub-consultants" are to sub-contractors and sub-

consultants of any tier;
2.16 a document is in "Agreed Form" if it is in the form initialled for the purposes of
identification as such by the University and Project Co or the University's Solicitors or Project
Co's Solicitors prior to the Effective Date with such changes as the Parties may agree in
writing;
2.17 any reference to employees, servants, agents, consultants, sub-contractors or advisers of the
University (or any combination thereof) shall be deemed to exclude Project Co and any
Contracting Associate in its capacity as such;
2.18 no rule of construction applies to the interpretation of this Agreement to the advantage or
disadvantage of one Party on the basis that such Party did or did not prepare this Agreement or
any relevant part of it;
2.19 words in the Project Documents importing any gender include any other gender and words in
the singular include the plural and words in the plural include the singular;
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2.20 where consent or approval of any Party hereto is required for any purpose under or in
connection with the terms hereof or there is a requirement to serve or give any notice then it
shall be given in writing;
2.21 any reference to a Party being required to use "reasonable endeavours" shall not require that
Party to incur disproportionate expenditure in order to comply with its obligations;
2.22 words and expressions in the Senior Lenders' Direct Agreement shall carry the same meaning
in this Agreement.
3. DURATION
This Agreement shall commence on the Effective Date and will continue until the Term
Expiry Date subject to earlier termination pursuant to the provisions of this Agreement
provided that the Project Co's obligations and the University's obligations relating to the Phase
1 Works and the Phase 2 Works shall be deemed to have commenced on the date (prior to the
Effective Date) upon which the Project Co or the Building Contractor commenced works on
Site.
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Part 1 - Grant of the Leases and Underleases
4. GRANT OF SW CAMPUS LEASES
4.1 The University and Project Co shall enter into the Deed of Variation and the Deed of
Surrender (Phase 1 Headlease) Part by a date not later than 7 Working Days from the
Effective Date. The University and Project Co shall (subject to the conditions referred to in
Clause 10 in relation to the relevant Lease being satisfied), grant and Project Co shall accept
the Supplemental Lease and Phase 2 Lease in the form of the Phase 1Supplemental Lease and
the Phase 2 Lease (as appropriate) and in consideration of payment by Project Co of the
Premium pursuant to Clause 16 and the Ground Rent pursuant to Clause 17 and Project Co
shall contemporaneously execute and deliver to the University the relevant counterparts.
4.2 The parties agree that the Agreement for Headlease and Agreement for Underlease both dated
28 March 2003 and made between Project Co and the University shall be of no further effect.
4.3 The completion of each of the grant of the Supplemental Lease and the grant of the Phase 2
Lease shall take place on the SW Campus Lease Contractual Completion Date.
5. GRANT OF SW CAMPUS UNDERLEASES
5.1 Project Co shall (subject to the condition referred to in Clause 10 being satisfied in relation to
the relevant Underleases) grant and the University shall accept underleases of the SW Campus
in the form in each case of the relevant SW Campus Underlease and the University shall
contemporaneously execute and deliver to Project Co the relevant counterpart.
5.2 The completion of the grant of each of the SW Campus Underleases shall take place on the
relevant SW Campus Underlease Contractual Completion Date for the relevant SW Campus
Underlease.
6. GRANT OF THE LONG TERM LEASES AND THE CORE ACCOMMODATION

UNDERLEASESHEADLEASES
6.1 The University shall (subject to the condition referred to in Clause 10 in relation to the
relevant Lease being satisfied) grant and Project Co shall accept leases of each of the parts of
the Property comprised in Phase 3 and Phase 4 in the form of the relevant Long Term Lease in
consideration of the payment by Project Co of the Premium pursuant to Clause 16 and the
Ground Rent pursuant to Clause 17 and of the Core Accommodation in the form of the Core
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Accommodation Headleases and Project Co shall contemporaneously execute and deliver to
the University relevant counterparts.
6.2 The completion of the grant of each of the Long Term Leases and the Core Accommodation
Headleases shall take place on the Long Term Lease Contractual Completion Date.
7. GRANT OF SHORT TERM UNDERLEASES
7.1 Project Co shall (subject to the condition referred to in Clause 10 being satisfied in relation to
the relevant underlease) grant and the University shall accept the grant of the relevant Short
Term Underleases in the form in each case of the relevant Short Term Underleases and the
University shall contemporaneously execute and deliver to the University the relevant
counterparts.
7.2 The completion of the grant of the Short Term Underleases shall take place immediately
following the Long Term Lease Contractual Completion Date.
8. SURRENDER OF SHORT TERM UNDERLEASES AND PART OF LONG TERM

LEASES
8.1 Project Co and the University shall enter into the relevant Deed of Surrender Short
Term Underlease on the relevant Date of Possession in respect of the Grizedale Short
Term Underlease and the County Short Term Underlease
8.2 Project Co and the University shall enter into the relevant Deed of Surrender Long Term
Lease on the date upon which the relevant Short Term Underlease for either Phase 3 or Phase
4 as appropriate expires or automatically terminates and the date upon which the Grizedale
Short Term Underlease and/or the County Short Term Underlease are surrendered
pursuant to Clause 8.1 above (as applicable).
9. GRANT OF THE LONG TERM UNDERLEASES AND THE CORE

ACCOMMODATION UNDERLEASES
9.1 Subject to the provisions of Clause 9.3 in relation to Phase 4 Project Co shall (subject to the
conditions referred to in Clause 10 in relation to the relevant Underlease being satisfied) grant
and the University shall accept underleases of each of the parts of the Property comprised in
Phase 3 and Phase 4 in the form of the relevant Long Term Underlease and of the Core
Accommodation in the form of the Core Accommodation Underleases and the University shall
contemporaneously execute and deliver to Project Co the relevant counterparts.
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9.2 Completion of the grant of each of the Long Term Underleases and the Core Accommodation
Underleases shall take place on the relevant Long Term Underlease Contractual Completion
Date for the relevant Long Term Underlease.
9.3 If either the University has not made an election pursuant to Clause 52.1 or if it is agreed or
determined that the Phase 4 Works Conditions Precedent have not been met or the Phase 4
Financing Conditions Precedent are not met by the Phase 4 Works Cut Off Date Project Co
shall not be required to grant and the University shall not be required to accept the County
Underlease or the Grizedale Underlease.
10. CONDITIONS
10.1 The grant of the Supplemental Lease, Phase 2 Lease, the Long Term Leases excluding the
County Field Supplemental Lease, the Short Term Underleases, the Long Term Underleases
excluding the County Field Supplemental Underlease, the SW Campus Underleases, the
Core Accommodation Headleases and the Core Accommodation Underleases are conditional
in each case upon a court of competent jurisdiction authorising agreements excluding in
relation to the relevant leases the provisions of sections 24 to 28 of the Landlord and Tenant
Act 1954.
10.2 The University and Project Co shall make (and each hereby agrees diligently to pursue) joint
applications to a court of competent jurisdiction for the authorisations referred to in Clause
10.1 above.
10A. VARIATION OF THE LEASES AND THE LONG TERM UNDERLEASES
10.A.1 The University and Project Co shall enter into the Deed of Variation of the Leases on the
Phase 4 Effective Date
10.A.2 Following the grant of the SW Campus Underleases and the Long Term Underleases in
respect of Phase 3 the University and Project Co shall enter into the Deed of Variation of
the Underleases on the date five Working Days after the grant of the same
10B. GRANT OF THE COUNTY FIELD SUPPLEMENTAL LEASE AND THE COUNTY
FIELD SUPPLEMENTAL UNDERLEASE
The University shall grant and Project Co shall accept the County Field Supplemental
Lease and Project Co shall contemporaneously execute and unconditionally deliver to the
University a counterpart of the County Field Supplemental Lease on the County Field
Supplemental Lease Contractual Completion Date
- 92 -
10.B.3 LANDLORD AND TENANT ACT 1954
Project Co confirms that in relation to the tenancy to be created by the County Field
Supplemental Lease and prior to the Phase 4 Effective Date:
10.B.3.1 the University served on Project Co a notice in respect of the County Field
Supplemental Lease, such notice being dated and
such notice complying with the requirements of section 38A(3) of the
Landlord and Tenant Act 1954; and
10.B.3.2 Project Co or a person duly authorised by Project Co made a statutory

declaration (the "Statutory Declaration") in respect of the notice referred to
in clause 8.1(a) (Landlord and Tenant Act 1954), such Statutory Declaration
complying with the requirements of schedule 2 to the Regulatory Reform
(Business Tenancies) (England and Wales) Order 2003.
10.B.3.3 Where the Statutory Declaration was made by a person other than Project
Co, Project Co confirms that the declarant was duly authorised to make such
Statutory Declaration on Project Co's behalf.
10.B.3.4 The University and Project Co agree that sections 24 to 28 (inclusive) of the
Landlord and Tenant Act 1954 shall be excluded in relation to the tenancy to
be created by the County Field Supplemental Lease.
10.B.3.5 The University confirms that in relation to the tenancy to be created by the
County Field Supplemental Underlease and prior to the Phase 4 Effective
Date:
(a) Project Co served on the University a notice in respect of the

County Field Supplemental Underlease, such notice being dated
and such notice complying with the requirements of section
38A(3) of the Landlord and Tenant Act, 1954; and
(b) the University or a person duly authorised by the University

made a statutory declaration (the "University Statutory
Declaration") in respect of the notice referred to in clause 8.4(a)
(Landlord and Tenant Act 1954), such University Statutory
Declaration complying with the requirements of schedule 2 to the
Regulatory Reform (Business Tenancies) (England and Wales)
Order 2003.
10.B.3.5 Where the University Statutory Declaration was made by a person other than
the University, the University confirms that the declarant was duly authorised
to make such University Statutory Declaration(s) on the University's behalf.
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10.B.3.6 Project Co and the University agree that sections 24 to 28 (inclusive) of the
Landlord and Tenant Act 1954 shall be excluded in relation to each of the
tenancies to be created by the University Underleases.
11. TITLE
11.1 Project Co shall accept the University's title to grant the Short Term Leases the Supplemental
Lease, the Phase 2 Lease and the Long Term Leases and the Core Accommodation Headleases
and to surrender the Short Term Underleases and shall not be entitled to require the University
to deduce or prove title or furnish any abstract or information in respect thereof.
11.2 The University shall accept Project Co's title to grant the Underleases and the Core
Accommodation Underleases and shall not be entitled to require Project Co to deduce or prove
title or furnish any abstract or information in respect thereof.
12. MATTERS AFFECTING THE PREMISES
12.1 The relevant parts of the Property will be let underlet and surrendered subject to and (where
appropriate) with the benefit of:
12.1.1 the Title Matters;
12.1.2 all local land charges and other matters whensoever registered or registrable
(whether registered or not) by any local or other authority and to every charge
notice direction order restriction agreement resolution proposal condition and other
matter affecting the relevant parts of the Property;
12.1.3 overriding interests (as defined in section 70(1) of the Land Registration Act 1925).
12.2 Project Co shall be deemed to have notice of the matters referred to in Clause 12.1 and shall
not be entitled to raise any requisition or objection in respect of them.
12.3 Project Co shall not be entitled to call for any superior or intermediate title nor raise any
requisitions thereon or objections thereto.
12.4 The Long Term Leases, the Phase 2 Lease, the Short Term Underleases, the Long Term
Underleases, the SW Campus Underleases, the Core Accommodation Headleases and the
Core Accommodation Underleases the County Field Supplemental Lease and the County
Field Supplemental Underleases shall take effect as if the relevant dispositions were
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expressly made subject to all matters subject to which the parts of the Property are expressly
to be let under the terms of this Agreement.
13. PRELIMINARY ANSWERS
13.1 Save in the case of any fraudulent misrepresentation Project Co agrees that it will have no
remedy against the University and that the University shall have no liability to Project Co in
respect of any statement made in the negotiations leading to this Agreement relating to Title
Matters.
13.2 The University hereby warrants that so far as it is aware and having made due and careful
enquiry the statements given in the Certificates of Title by the University that are prefixed by
the phrase "The University has told us …." are true and accurate and not misleading as at the
date of the Certificate of Title subject to the disclosures made in the seventh schedule of the
Certificates of Title and the information provided to its solicitors to enable them to prepare the
Certificate of Title is complete and accurate in all material respects.
14. ENGROSSMENTS
The engrossments of the Long Term Leases, the Phase 1 Lease, Phase 2 Lease, the Short Term
Underleases, the Long Term Underleases, the SW Campus Underleases, Deeds of Surrender,
Long Term Leases, the Core Accommodation Headleases and the Core Accommodation
Underleases the County Field Supplemental Lease and the County Field Supplemental
Underlease the Deed of Surrender Short Term Underlease and Deed of Surrender Long
Term Lease shall be prepared by the University and executed by the Project Co in counterpart
and delivered to Project Co's solicitors on the relevant date for completion.
15. STANDARD COMMERCIAL PROPERTY CONDITIONS
15.1 The Standard Commercial Property Conditions are incorporated in this Agreement insofar as
they are applicable to a sale by private treaty and where there is a conflict between them and
any other provision of this Agreement that other provision prevails.
15.2 SCPC 3.1.3 4.3.2 4.5.2 4.5.5 5.2 8.2.4 and 8.3 do not apply.
15.3 SCPC 6.3.4 is amended to read "For the purposes of apportioning income and outgoings it is
to be assumed that they accrue at an equal daily rate throughout the period to which they
relate. In the case of annual rents (whether or not payable quarterly) this period is the period
of 365 days (or 366 in a leap year)".
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16. PAYMENT OF THE PREMIUM AND WORKS PAYMENT
16.1 Project Co shall pay to the University on the Effective Date the Premium less the sums shown
in the Closing Statement as a premium for the grant of the Phase 2 Lease and the Long Term
Leases. The premium will be apportioned between the Phase 2 Lease and the Long Term
Leases on a fair and reasonable basis as agreed between the parties.
16.2 Project Co shall pay to the University on the Phase 4 Effective Date the sum of Five
Million Pounds in consideration of the University entering into the Deed of
Variation of the Leases.
16.3 The University shall pay to Project Co the Works Payment on the Phase 4 Effective Date
in consideration of the Works Payment Works being carried out.
17. GROUND RENT
The provisions of Schedule 14 (Ground Rent) shall apply in relation to the calculation of the
Ground Rent which shall be payable pursuant to the Headleases.
18. THE UNIVERSITY ACCOMMODATION CHARGE
The provisions of Schedule 13 (the University Accommodation Charge and Performance

Measurement System) shall apply in relation to the calculation of the University
Accommodation Charge which shall be payable as rent pursuant to the Underleases.
19. VACATION INCOME
The provisions of Schedule 15 (Vacation Lettings) shall apply in relation to the calculation of
income from Vacation Use Agreements and the Project Co Vacation Fee which shall be
payable as rent pursuant to the Underleases.
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Part 2 - Planning
20. SATISFACTION OF RESERVED MATTERS AND PARTIES OBLIGATIONS IN

RELATION TO PLANNING CONDITIONS
20.1 Save as set out in this Clause 20 Project Co shall be responsible for complying with all
conditions attached to the Planning Permissions and at its own cost and shall indemnify the
University in respect of any actions arising from breach of such conditions.
20.2 The University shall offer all reasonable assistance to Project Co in connection with the
satisfaction of the conditions attached to the Planning Permissions including procuring the
delivery of the Transportation Statement, as defined in and required as part of condition 2
attached to the outline planning permission dated 5 September 2002 No. 02/00525/OUT as
varied by planning permission dated 13 January 2003 No. 02/01242/FUL (the "Phase 2
Planning Permission") to the local planning authority and the highway authority and
providing all necessary assistance to agree such assessment with the local planning authority
and the highway authority.
20.3 In satisfying the conditions attached to the Planning Permissions Project Co will consult and
liaise with the University in all material respects and in particular will:
20.3.1 have proper regard to any representations that the University or its professional
advisers may make in relation thereto;
20.3.2 give to the University reasonable notice of and permit the University and its
relevant professional advisers to attend any meetings to be held between Project Co
and the local planning authority.
20.4 The University shall provide to the local planning authority the details of the green travel plan
and transportation assessment for approval in accordance with the provisions of condition 11
of the outline planning permission dated 5 September 2002 Application No 02/00525/OUT
and use all reasonable endeavours to procure the approval of the local planning authority to
both the green travel plan and the transportation assessment.
20.5
20.5.1 In relation to conditions 5, 6 and 7 attached to the outline planning permission
dated 5 September 2002 Application No 02/00525/OUT as varied by the Phase 2
Planning Permission the University shall be responsible for any additional costs in
the carrying out of the highway works between Hazelrigg Lane/Chapel Lane and
the A6 (the "Highway Works") required by either the local planning authority or
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the County Council and reasonably and properly incurred by Project Co and which
exceed the amounts attributed to such works in the Operating Financial Model, to
the extent only that such costs arise as a result of requirements imposed by the local
planning authority or the highway authority as appropriate and which are due to
increased development by the University on the Lancaster University Campus and
do not in any way relate to the development the subject of the Works or offsite
requirements resulting from the Works.
20.5.2 The University shall bear fifty per cent of any costs exceeding those currently
allocated to the design and construction of the Link Road where such costs arise
out of the requirement for the Link Road to contain a roundabout rather than a T
Junction provided that the University's maximum liability under this Clause 20.5.2
shall not exceed
20.6 Project Co shall negotiate in consultation with the University and its professional advisors the
terms of an agreement under sections 38 and 278 of the Highways Act 1980 ("the Highways
Agreement") to provide for the design and construction of the Highway Works and their
adoption by the highway authority.
20.7 The University agrees that it shall be a party to the Highways Agreement as owner of the land
on which the Highway Works are to be constructed PROVIDED THAT a provision shall be
included in the Highways Agreement whereby either Project Co indemnifies the University in
respect of all actions claims demands expenses and proceedings whatsoever arising out of or
in connection with or incidental to the carrying out of the Highway Works or the agreement
provides that the University incurs no liability in respect of such works.
20.8 Project Co shall use its reasonable endeavours to obtain at its own expense an order under
section 14 of the Road Traffic Regulation Act 1984 to provide for the temporary closure of the
relevant section of footpath 14 (as described in the Definitive Map held by the Highway
Authority) and an order under section 257 of the Town and Country Planning Act 1990 for the
permanent diversion of the relevant section of footpath 14 insofar as such temporary closure
and permanent diversion are required to enable the Highway Works to be carried out.
20.9 The parties agree that to the extent that the number of car parking spaces as currently
identified in the Project Co's Proposals cannot be built (which issue shall be determined no
later than 31 May 2004) as part of the Works due to the application of condition 9 of the
Outline Planning Permission dated 5 September 2002 Application No 02/00525/OUT relating
to Phase 3 and Phase 4 of the Works then there shall be deemed to be a Qualifying Variation
to construct such spaces as are permitted by the local planning authority and the provisions of
Schedule 1 (Variations) of this Agreement shall apply.
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20.10 Project Co shall use its reasonable endeavours to secure a traffic regulation order in relation to
the southern end of Green Lane to prevent vehicular traffic using the said section of Green
Lane provided that if such traffic regulation order cannot be obtained (which issue shall be
determined no later than 31 May 2004) then Project Co's Proposals shall be amended to delete
the requirement to carry out that part of the Works.
20.11 The parties shall use all reasonable endeavours to ensure that on its completion and prior to its
opening for use the Link Road is adopted by the highway authority and maintained at the
public expense pursuant to an agreement between Project Co the highway authority and the
University under section 38 of the Highways Act 1980 or alternatively adopted as highway
under section 37 of the Highways Act 1980 (as the case may be).
20.12 In the event that the parties are unable to secure the adoption of the Link Road and its
maintenance at the public expense in accordance with clause 20.11, Project Co shall from the
date of opening for use of the Link Road to the date of its adoption and maintenance at the
public expense by the highway authority maintain or procure the maintenance of the Link
Road so that it is at all times fit for use as a highway and Project Co shall indemnify the
University in respect of all actions claims demands expenses and proceedings arising as a
result of any act or default of Project Co whatsoever arising in connection with or incidental to
the use of the Link Road from the date of its opening for use to the date of its adoption and
maintenance at the public expense by the highway authority provided that if the Link Road is
not adopted and maintained at the public expense by the date which is 38 years from the
Effective Date then Project Co shall account to the University for the balance of any unutilised
commuted sum referred to in any relevant agreement entered into pursuant to Clause 20.11
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Part 3 - The Operating Financial Model
21. FINANCIAL MODEL
21.1 General
21.1.1 On the Effective Date Project Co shall deliver two copies of the Base Case
Financial Model to the University.
21.1.2 Amendments to the Base Case Financial Model or the Operating Financial Model
as appropriate shall be made where required in accordance with the terms of the
Senior Lenders' Direct Agreement and any dispute as to whether such amendments
are required and if so what these amendments shall be, shall be determined by an
Expert in accordance with the Liaison and Disputes Resolution Procedure.
21.1.3 Subject to Clause 21.1.2 above neither party shall make any changes to the
Operating Financial Model without the prior written consent of the other.
21.2 Intellectual Property Rights in the Operating Financial Model
21.2.1 Project Co warrants that it is the owner of or has the right to use the Intellectual
Property in the combination of programming instructions in the Base Case
Financial Model and the Operating Financial Model and that the proper use of such
instructions by the University shall not infringe any copyright or any other
Intellectual Property of any person.
21.2.2 Project Co hereby grants to the University a perpetual, transferable (but only to any
permitted assignee of any rights or benefits of the University under the Project
Documents), non-exclusive, royalty-free licence (carrying the right to grant sub-
licences) to use (but not change, unless otherwise agreed by the Parties or
determined pursuant to the Liaison and Disputes Resolution Procedure) the Base
Case Financial Model, the Operating Financial Model or any revised Operating
Financial Model for any purpose in connection with this Agreement.
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Part 4 - General Performance Obligations and Co-operation
22. GENERAL PERFORMANCE STANDARDS OF PROJECT CO
Without prejudice to the specific obligations set out in the relevant Project Documents Project
Co shall perform its obligations under the Project Documents to which it is party:
22.1 in accordance with the Specification;
22.2 causing as little disruption to the University and any Students and/or any Occupiers of which
Project Co has received written notification from the University and/or the Adjoining Land as
is reasonably practicable and consistent with its obligations under the Project Documents;
22.3 in accordance with all applicable Legislation;
22.4 with reasonable skill and care and in accordance with Good Industry Practice; and
22.5 using its reasonable endeavours to specify and use materials that are environmentally friendly
to the extent reasonably practicable having regard to the Project Co's Proposals, the Output
Brief and the Output Specification.
23. SUB-CONTRACTS AND ANCILLARY DOCUMENTS
23.1 Appointment of sub-contractors
The University hereby consents to:-
23.1.1 the appointment by Project Co of Jarvis Construction UK Limited (company

number 2833805) as the Building Contractor; and
23.1.2 the appointment by Project Co of Jarvis Workspace FM Limited (company number

3511197) as the Hard FM Contractor.;
23.2 Replacement of Sub-Contractors
23.2.1 Project Co will not appoint any Sub-Contractor or sub-consultant as a replacement

Sub-Contractor without the University having given its prior written consent in
accordance with sub-Clause 23.2.2 below.
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23.2.2 It is agreed and acknowledged that in determining whether to give or withhold its
consent to any of the matters referred to in Clause 23.2.1 the University must act
reasonably. For this purpose, the University shall be entitled to withhold its
consent if it reasonably believes that any proposed new Sub-Contractor will not be
able to perform the obligations to be placed on it because it does not have sufficient
experience of providing works and/or services similar in scope and nature to the
Works and/or Services or its covenant strength is such that any replacement
building contractors deed of warranty or Hard FM contract guarantee would give
the University less protection than the Building Contractor's Deed of Warranty or
the Hard FM Contract Guarantee (as appropriate) and such protection would be
insufficient for the University (acting reasonably). Project Co shall promptly
supply such information as the University may reasonably require for the purpose
of determining whether the replacement Sub-Contractor will be able to perform the
obligations to be placed on it.
23.2.3 Notwithstanding the provisions of this Clause 23.2 or the appointment of any new
Sub-Contractor or the University's consent thereto, Project Co shall remain wholly
and primarily responsible and liable to the University at all times in relation to its
obligations under the Project Documents.
23.3 Performance of sub-contract obligations
Project Co shall perform its obligations under and observe all the terms of the Sub-Contracts
and shall not without the prior written consent of the University (which is not to be
unreasonably withheld or delayed):
23.3.1 terminate any Sub-Contract, the Building Contract Guarantee or the Hard FM
Contract Guarantee other than in accordance with its terms;
23.3.2 make or agree to any material amendment to or variation of any Sub-Contract, the
Building Contract Guarantee or the Hard FM Contract Guarantee where such
amendment or variation is likely to be materially adverse to the interests of the
University under the Project Documents or Building Contractors' Deed of Warranty
(as appropriate) (including the University's rights and remedies thereunder);
23.3.3 depart from, or waive or allow to lapse in any material respect any rights it may
have under any Sub-Contract, the Building Contract Guarantee or the Hard FM
Contract Guarantee where such departure, waiver, or lapse is likely to be materially
adverse to the interests of the University under the Project Documents or the
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Building Contractor's Deed of Warranty, including the University's rights and
remedies thereunder (as appropriate).
23.4 Documents to be delivered by Project Co
23.4.1 Project Co shall, within a reasonable period from the Effective Date and in any
event no later than three (3) months from the Effective Date, deliver to the
University conformed or certified copies of the documents referred to in Schedule
19 (Documents to be delivered by Project Co).
23.4.2 If, at any time, a material amendment is made to any Sub-Contract or Project Co
grants or is granted a waiver or release of any material obligations under any Sub-
Contract or Project Co enters into a replacement Sub-Contract, Project Co shall
deliver to the University a copy of each such amendment, release replacement Sub-
Contract or waiver or (so far as it is not in writing) a true and complete record
thereof in writing as soon as reasonably practicable following the date of its
execution or creation, certified a true copy by an officer of Project Co.
23.5 Delivery of Additional Ancillary Documents
If at any time a new Sub-Contractor is appointed and/or a new Employer's Agent Project Co
shall procure that simultaneously there is entered into in favour of the University a further
deed of warranty in substantively the same form as the relevant Deeds of Warranty.
23.6 Assignment of Building Contract Guarantee
Where the University has exercised its step in rights pursuant to the Building Contractor's
Deed of Warranty the Project Co shall procure that the benefit of the Building Contract
Guarantee is assigned to the University.
24. CO-OPERATION
Each Party agrees to co-operate in good faith with the other Party and the University agrees to
co-operate in good faith with the Contracting Associates and pursuant to the terms of the
Senior Lenders' Direct Agreements with the Senior Lenders in relation to the Project
(including without limitation, in the case of the University, co-operating to obtain and
maintain those Necessary Consents relating to fire safety, emergency evacuations and health
and safety plans) and to provide all information reasonably required by the other Party save, in
either case, to the extent that:
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24.1 such information is readily obtainable by the other Party from other sources;
24.2 such co-operation or disclosure would:
24.2.1 unreasonably interfere with the rights of either of the Parties to arrange its affairs in
such manner as it reasonably considers fit; or
24.2.2 oblige either Party to incur unreasonable additional cost; or
24.3 such co-operation or disclosure by Project Co would involve delay or disruption to the Works,
24.4 such information is reasonably and properly considered by Project Co as being commercially
sensitive information.
25. CONFIDENTIALITY
25.1 Subject to Clause 25.2, each Party shall keep confidential all Confidential Information and
shall not disclose and shall use all reasonable endeavours to prevent its employees and agents
from disclosing to any person any such Confidential Information.
25.2 Clause 25 shall not apply to:
25.2.1 any disclosure which is required by any Legislation (including any order of a court
of competent jurisdiction) or any parliamentary obligation or any requirement for
disclosure by the National Audit Office or the Higher Education Funding Council
for England or similar organisations;
25.2.2 subject to any professional advisers being bound by a duty of confidentiality, any
disclosure to either party's professional advisers;
25.2.3 any disclosure by Project Co or the University of information (other than

commercially sensitive information) relating to the design, construction, operation
and maintenance of the Project and such other information (other than
commercially sensitive information) as may be reasonably required in order to
enable Project Co or the University to comply with its obligations under the Project
Documents, subject to the recipient being bound by a duty of confidentiality;
- 104 -
25.2.4 any disclosure by either party of any information which the other party (acting
reasonably) has agreed with the first party contains no commercially sensitive
information; and
25.2.5 any provision of information by Project Co to any Senior Lender or Senior Lender's
professional advisers or insurance advisers where it is proposed that a person
should or may provide funds (whether directly or by way of loan to equity
participants or otherwise) to Project Co to enable it to carry out its obligations
under the Project Documents to that person but only to the extent necessary to
enable a decision to be made on the proposal and for ongoing monitoring by Senior
Lenders under the provisions of the Financing Agreements;
25.2.6 provision of information to either the University's or Project Co's auditors in

relation to the preparation of annual reports and accounts or otherwise;
25.3 The provisions of this Clause 25 shall survive the termination of this Agreement.
25.4 Freedom of Information
25.4.1 The parties acknowledge that:
(a) pursuant to the provisions of section 1(1) of the Freedom of

Information Act 2000 (the Act) any person has a right to request
information in any form, including information relating to or disclosed
pursuant to this Agreement (the Information), from the University;
(b) the University has a duty (to the extent required by and subject to any
exemptions in the Act) to disclose whether or not it holds the
Information and subsequently to communicate it to the person making
the request.
25.4.2 Project Co shall co-operate to enable the University to comply with its
obligations under the Act.
25.4.3 The University agrees that Project Co may make representations that certain
information may be commercially sensitive and qualifies for exemption from
disclosure under the Act and the University shall take those representations
into account in good faithbefore deciding whether the information is
- 105 -
disclosable and whether any exemptions apply in the light of its duties under
the Act including as to timescales for disclosure of the information.
25.4.4 This clause 25.4 is without prejudice to clauses 25.1 to 25.3.
26. REPUTATION OF THE UNIVERSITY
Without prejudice to the obligations of Project Co under the Project Documents, Project Co
will not, and will use all reasonable endeavours to ensure that the Contracting Associates will
not, by any wilful act or omission cause an Adverse Reputational Effect.
27. PROHIBITION ON DIVERSIFICATION
Project Co shall not carry on any business or be interested in the carrying on of any business
other than carrying out the activities and doing such things as may be contemplated by the
Project Documents except with the prior written consent of the University (which consent may
be withheld at the sole discretion of the University).
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Part 5 - The Development Phase
28. CARE OF THE WORKS, REINSTATEMENT AND REPAIR
28.1 Care of the Works
Save to the extent that such loss and/or damage arises as a result of an event of Force Majeure
and subject to the terms of the Project Documents, Project Co shall be responsible for all loss
and/or damage to the Works and all materials, plant and equipment brought on to the
Construction Site by or on behalf of Project Co or any Contracting Associate during the
course of carrying out the Works.
28.2 Reinstatement and Repair
If all or part of the Works are damaged or destroyed at any time prior to the relevant Works
Completion Date for that Phase of the Works other than as a result of an event of Force
Majeure, Project Co shall (subject to Clause 28.3) as soon as practicable, reinstate, replace or
make good the same to the standards required by this Agreement in relation to the Works.
Subject to Clause 28.3, such reinstatement, replacement and repair shall be undertaken by
Project Co at its own cost.
28.3 Cost of Reinstatement and Repair – Compensation Events
28.3.1 Where any damage or destruction of the type referred to in Clause 28.2 arises from
circumstances which constitute a Compensation Event, Project Co shall diligently
pursue, either on its own behalf or as agent on behalf of the University and at the
University's cost, claims by the University under the insurances maintained by
Project Co under Schedule 18 (Insurances) of this Agreement in respect of such
damage and shall, subject to Clause 28.3.2, only be required to reinstate, replace or
make good such damage upon the receipt of proceeds from the insurers (which
Project Co shall be entitled to apply for that purpose) or, if earlier, on the
agreement of Scheduled interim payments with insurers. If and to the extent funds
sufficient to cover Project Co's costs of such reinstatement, replacement or making
good are not received from the insurers (other than as a result of failure by Project
Co to comply with its obligations under Schedule 18 (Insurances) of this
Agreement) then the University shall fund Project Co for such costs to that extent
and Project Co shall only be required to reinstate, replace or make good such
damage upon receipt of those funds from the University. For the avoidance of
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doubt any breach by the University of its obligations in this Clause 28.3.1 shall be a
Compensation Event.
28.3.2 If and to the extent that funds sufficient to cover the reinstatement or repair referred
to in Clause 28.3.1 are not received from the insurers as a result of a failure by
Project Co to comply with its obligations under Schedule 18 (Insurances) of the
this Agreement then Project Co shall not, to that extent, be relieved of its
obligations under Clause 28.2.
29. SITE CONDITIONS AND UTILITIES
29.1 Condition of Site
29.1.1 The University warrants to Project Co that it has, prior to the date of this
Agreement, disclosed to Project Co all information of which it is aware concerning
the condition of the Construction Site which may adversely affect the carrying out
of the Works. Any breach by the University of this warranty shall constitute a
Compensation Event and the provisions of Clauses 34 (Extensions of Time) and
Clause 42 (Compensation Events) shall apply.
29.1.2
(a) 29.1.2 Without prejudice to Clause 29.1.1 and save as provided for in
29.1.2 (b) Project Co is deemed to have obtained for itself all necessary
information as to risks, contingencies and all other circumstances which
may influence or affect the carrying out of the Works and Project Co will
accept entire responsibility for ascertaining the conditions of the
Construction Site including, without limitation, ground, load bearing and
other structural parts, climatic, hydrological and other general conditions
including whether or not there are any archaeological or similar matters, the
nature of the ground and sub-soil, the form and nature of the same and the
risk of injury or damage to property adjacent to the same and to occupiers
of such property and the nature of the materials (whether natural or
otherwise) to be excavated for the carrying out and completion of the
Works and shall not be entitled to an extension of time or additional costs
as a result of the existence of any of the aforementioned matters.
(b) to the extent that unforeseen ground conditions exist under that part of
County known as County Main as at the Phase 4 Effective Date,
Project Co shall not be responsible for them, unless the occurrence of
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the ground conditions or the likelihood thereof was identified in or
reasonably foreseeable from the content of the Phase 4 Surveys or,
would have been so identified or so foreseeable if the author of the
relevant Phase 4 Survey had exercised the degree of skill and care
reasonably to be expected of a properly qualified professional
consultant experienced in compiling surveys similar to the relevant
Phase 4 Survey in relation to projects similar to the Project. If Project
Co is not responsible for such ground conditions under this clause
29.1.2 (b) then the University shall be so responsible and the same shall
constitute a Compensation Event during the Construction Period or
the Operational Phase and during the Operational Phase shall also be
an Excusable Breach.
29.1.3 Without prejudice to Clause 29.1.1 Project Co accepts the Construction Site in its
state and condition in all respects as at the date of this Agreement.
29.1.4 Project Co shall in exercising its rights granted under the Project Documents
observe and comply with the terms and conditions of any Rights in Respect of
Land applicable to the Construction Site.
29.2 Utilities
29.2.1 The University shall by the relevant Date of Possession:
(a) lawfully divert or disconnect any Utilities within the Construction Site
which serve any buildings on the Adjoining Land; and
(b) lawfully disconnect and cap Utilities within the Construction Site which
exclusively serve Existing Accommodation on the Construction Site.
in both cases in accordance with agreed specifications (both parties acting

reasonably);
Project Co shall, in accordance with Good Industry Practise, identify and notify to
the University any failure by the University to comply with its obligation under this
Clause 29.2.1 of which Project Co becomes aware.
29.2.2 The University shall for the purposes of the Works make available by the dates
specified in Project Co's Proposals points of connection for Utilities required to
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serve the Project Co Accommodation, such points of connection to be in the
locations and positions identified in and sufficient to service the capacities for
Utilities specified in Project Co's Proposals.
29.2.3 Save in respect of the University's obligations in relation to Utilities contained in

Clauses 29.2.1 and 29.2.2 (performance of which shall be at the University's own
cost) and save where connections are made to the University's Infrastructure,
Project Co shall be responsible for and shall pay to all relevant authorities or
undertakings all costs and expenses incurred in diverting, disconnecting or
otherwise carrying out works in respect of the Utilities.
29.2.4 Project Co shall pay to all relevant authorities or utilities companies all costs and
expenses relating to the use by Project Co of the Utilities (and without prejudice to
Clause 29.2.5 the availability of the same) for the purpose of carrying out the
Works.
29.2.5 The University shall prior to the commencement of the Works and provided that
the University is reasonably able to make available such a supply without adversely
affecting its own operations at or occupation of the Site provide to Project Co a
temporary supply of electricity from the University's Infrastructure sufficient for
the purpose of carrying out and completing the Works and further provided that
Project Co shall install an electricity meter at the relevant point of connection and
pay to the University or the relevant authorities or utilities companies as the
University may direct the cost of electricity supplied through the University
Infrastructure and used by Project Co in connection with the Works.
29.2.6 Save as may be reasonably necessary in order to avoid or negate any material
adverse effect upon its own operations at or occupation of the Site, the University
shall not itself and where reasonably practicable shall not permit others to interrupt,
interfere with or reduce the electricity supply referred to in Clause 29.2.5.
29.2.7 Project Co shall only make use of the Utilities for purposes in connection with the
Project.
29.3 Possession of the Site
29.3.1 VacantSubject to the provisions of clause 29.3.3 in respect of that part of the
Construction Site which relates to County Main vacant possession of the
Construction Site shall be given to Project Co by the University on the applicable
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Date of Possession. The University also grants to Project Co and those authorised
by Project Co such rights of access and passage with or without workmen, tools
and vehicles to and over the Access Routes, as may reasonably be necessary for the
purpose of carrying out and completing the Works.
29.3.2 Prior to the applicable Date of Possession for a Phase of the Works Project Co and
those authorised by Project Co shall be entitled to have access to the relevant part
of the Construction Site with the prior consent of the University (which shall not be
unreasonably withheld or delayed but which may be subject to such conditions as
the University may reasonably require) to carry out site investigations, preparatory
work or other work which is reasonably required in order to secure approval of
reserved matters in relation to the relevant Planning Permissions and access to
Inner Fylde prior to the Date of Possession for Section 2A for the purposes of
carrying out all necessary surveys related to the demolition of Inner Fylde.
29.3.3 Notwithstanding the expiry of the County Short Term Underlease the
University shall not be obliged to give vacant possession of County until the
earlier of:
(a) the date five Working Days after the Works Completion Conditions or
the conditions in clause 35.3 have been satisfied in respect of the
County Field Blocks A-E Works insofar as they relate to County Field
Blocks A-E Works; or
(b) where the Works Completion Conditions or the conditions in clause

35.3 are satisfied in respect of the County Field Works insofar as they
relate to the County Field Blocks A-E Works and where such
conditions have been satisfied during a Required Period, the date five
Working Days after expiry of the Required Period in which the
conditions are satisfied; and
(c) where the provisions of clause 29.3.4 apply the date all Students have
vacated County Main.
29.3.4 If the Target Date for Phase 4 Completion in respect of the County Field
Blocks A-E Works is delayed as a result of a Delay Event then, subject to
clause 29.3.5, the University will procure that on the Date of Possession (being
for the purposes of this clause 29.3.4, 7 January 2008 as extended only by any
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delay to the County Field Blocks A-E Works which is not caused by a Delay
Event) Students in County Main:
(a) relocate from County Main to Rooms in County Field in respect of

which the Works Completion Conditions have been satisfied; or
(b) if there are insufficient Rooms in County Field in respect of which the
Works Completion Conditions have been satisfied to accommodate all
of the Students in County Main, accept temporary accommodation
pursuant to clause 35 (Alternative Accommodation);
and failure by the University to comply with its obligations in this clause 29.3.4
shall be a Compensation Event.
29.3.5 Project Co may, at its discretion, direct the University not to comply with
clause 29.3.4 in respect of all or part of the Rooms in County Main. Such
direction shall be given in writing:
(a) at least ten Working Days before the Date of Possession; and
(b) if the University's obligation in clause 29.3.4 is to apply to only some of

the Rooms in County Main in respect of which Rooms the University
should not so comply.
29.4 Latent defects in County Main
Where a Latent Defect in County Main causes damage or disrepair to County Main or
otherwise (if not remedied) would cause the Works not to be in the condition required by
this Agreement then Project Co shall repair and rectify or carry out such other remedial
works necessary provided that the occurrence and/or the repair and/or the rectification
of such damage or the carrying out of such other remedial works whether during the
Construction Period or the Operational Phase shall be a Compensation Event and
during the Operational Phase shall also be an Excusable Breach.
30. CDM REGULATIONS
30.1 In this Agreement, "Client", "Executive", "Health and Safety Plan", " Health and Safety
File", "Designer", "Planning Supervisor" and "Principal Contractor" have the same
meanings as in the CDM Regulations.
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30.2 Project Co represents and warrants to the University that it is and shall continue to be
competent to perform the duties imposed on a Client by the CDM Regulations.
30.3 The University hereby appoints Project Co as the only Client in respect of the relevant Project
Co Operations, pursuant to Regulation 4(1) of the CDM Regulations. Forthwith following
execution of this Agreement, Project Co shall provide to the University a copy of the
declaration which it is obliged to send to the Executive in accordance with Regulation 4(4) of
the CDM Regulations. Upon receipt, Project Co shall forthwith send to the University a copy
of the notice from the Executive that it has received the declaration.
30.4 For as long as the relevant Project Co Operations remain to be performed under this
Agreement Project Co shall not terminate, withdraw or derogate in any manner from its
declaration or its acceptance of its responsibilities as Client.
30.5 Project Co shall:
30.5.1 carry out and comply with or procure the carrying out and compliance with all the
obligations, requirements and duties of a Client, Designer, Planning Supervisor and
Principal Contractor arising under the CDM Regulations in connection with the
relevant Project Co Operations; and
30.5.2 procure that:
(a) the Health and Safety Plan and Health and Safety File are each prepared
and maintained in accordance with the CDM Regulations;
(b) the Health and Safety File is, upon reasonable notice, made available to the
University for the purposes of inspection and/or photocopying; and
(c) within 4 weeks of the relevant Works Completion Date any Planning
Supervisor appointed pursuant to the CDM Regulations delivers to the
University the relevant Health and Safety File.
30.6 Project Co will be deemed to have accepted responsibility as Client in respect of the relevant
Project Co Operations from the date of commencement of the same and shall not seek to hold
the University responsible as Client in respect of the Project in respect of any period after that
date.
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30.7 The University shall provide to Project Co such information and documents as may be in the
University's possession or which the University may reasonably obtain from time to time
which may be required by Project Co to fulfil its duties as Client for the purposes of the CDM
Regulations.
31. ANTIQUITIES
31.1 Property
As between the Parties, all fossils, antiquities and other objects having artistic, historic or
monetary value which may be found on the Construction Site or in any excavations at the
Construction Site by Project Co or any Contracting Associate during the carrying out of the
Works are and shall remain the property of the University save where the University does not
issue an instruction in relation to the relevant item within the period of 5 Working Days
referred to in and otherwise in accordance with Clause 31.3 (and in such circumstances the
title in the relevant item shall pass from the University to Project Co and, subject to
compliance with Legislation and Necessary Consents, Project Co shall be entitled to do with
the same item whatever it considers appropriate).
31.2 Discovery
Upon the discovery of any such item as referred to in Clause 31.1, Project Co shall:
31.2.1 promptly inform the University of such discovery;
31.2.2 comply with all Legislation and Necessary Consents in respect of such item; and
31.2.3 (save to the extent that instructions to the contrary are given by the University
pursuant to Clause 31.3 or the University does not give any instruction in relation
to the relevant item within the period of 5 Working Days referred to in and
otherwise in accordance with Clause 31.3) take all such steps as are necessary not
to disturb the object and, if necessary, cease any relevant Works insofar as carrying
out the Works would endanger the object or prevent or impede its excavation.
31.3 Action
Within 5 Working Days of receipt by the University of Project Co's notification pursuant to
Clause 31.2 the University may issue instructions to Project Co specifying what action (if any)
the University reasonably requires Project Co to take in relation to the examination,
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excavation, removal or preservation of the item beyond that required for Project Co to comply
with Clause 31.2, and Project Co shall promptly and diligently comply with the same provided
that:
31.3.1 the University's instruction shall be in a form which most effectively avoids or
minimises any additional costs so far as is reasonably practicable in the
circumstances; and
31.3.2 the issue of such an instruction shall constitute a Compensation Event and a Delay
Event but otherwise shall be for Project Co's account.
32. DESIGN AND CONSTRUCTION OF THE WORKS
32.1 Project Co Obligations
With effect from the Effective Date and subject to Project Co having secured such Necessary
Consents as may be requisite for the lawful commencement of the Works, Project Co shall
proceed to carry out and complete or procure the carrying out and completion of the Works in
accordance with the following order of precedence (which shall apply without prejudice to
Clause 22 (General Performance Standards of Project Co) of this Agreement:
32.1.1 in compliance with all Legislation;
32.1.2 in compliance with all Necessary Consents;
32.1.3 in accordance with the terms and conditions of this Agreement (other than the
Output Brief and Project Co's Proposals);
32.1.4 in accordance with the Output Brief; and
32.1.5 in accordance with Project Co's Proposals (as the same are developed in accordance
with the Design Development Procedure).
32.2 Standards of Design and Construction
Project Co warrants and undertakes to the University that:
32.2.1 it has exercised and shall continue to exercise in the performance of its design
obligations hereunder all the reasonable skill, care and diligence to be expected of
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an appropriately qualified professional designer who is experienced in the design
and specification of accommodation and facilities of a size, complexity and nature
similar to the Works;
32.2.2 it has not specified and shall not specify for use in or incorporate into the Works
any of the Works Prohibited Materials;
32.2.3 it has used and shall continue to use, in carrying out the Works, only goods,
materials and equipment which are of satisfactory quality;
32.2.4 it has ensured and shall continue to ensure that the Works are undertaken in a good
and workmanlike manner; and
32.2.5 it has and shall:
(a) not contaminate the Site, the Construction Site or any other part of the
Lancaster University Campus in any way which is capable of causing
significant harm or creating a significant possibility of significant harm
being caused to the environment or to the health and safety of persons; and
(b) carry out the Works in accordance with good environmental practice.
32.3 Working Procedures and Monitoring
32.3.1 The Parties shall comply with the provisions of the Project Procedures Manual.
32.3.2 Project Co shall procure that the University's Contract Manager and/or any persons
authorised by the University's Contract Manager (and notified to Project Co) shall
have the right at all reasonable times and upon giving reasonable prior notice to
Project Co to enter upon the relevant part or parts of the Construction Site to view
the state and progress of the Works (including the materials and goods used and
intended for use) and to ascertain whether or not the requirements of this
Agreement have been and are being duly observed and performed.
32.3.3 The University's Contract Manager (and/or other persons authorised by him) shall,
upon arrival at the Construction Site, report their presence to the Building
Contractor or person in control of the Construction Site and comply with any
reasonable directions and rules made by the Building Contractor or such person.
The University's Contract Manager shall not in any circumstances give instructions
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to any person or company involved in carrying out the Works other than to Project
Co
32.3.4 Project Co shall procure that satisfactory facilities are made available and
reasonable assistance is given to enable the University's Contract Manager properly
to inspect, witness or survey the carrying out of the Works.
33. DESIGN DEVELOPMENT
33.1 Continuing Development
33.1.1 Project Co shall, in accordance with the terms of this Agreement, prepare, develop
and complete the Reviewable Design and in relation thereto the Parties shall
comply with their respective obligations set out in the Design Development
Procedure
33.1.2 Not later than
(a) 5 August 2005 in the (in the case of the sample standard bedroom); and
(b) 30 August 2005 (in the case of the sample standard kitchen),; and
(c) 13 August 2007 in respect of the sample standard bedroom and sample
standard kitchen for Phase 4
Project Co shall have designed, constructed and completed each of the Sample
Rooms on the Construction Site (at a location to be agreed between the parties
(with the Building Contractor) acting reasonably)
33.1.3 The Sample Rooms must comply with this agreement (including to avoid doubt the
Output Brief and the Project Co Proposals)
33.1.4 Project Co shall make submissions of Reviewable Design in sufficient time to

allow the Sample Rooms to be completed as contemplated by clause 33.1.3
33.1.5 The University will issue Sign Off Notices in respect of any Reviewable Design
relating to the Sample Rooms in accordance with the provisions of clause 33.3
33.1.6 When Project Co is of the opinion (acting reasonably) that the Sample Rooms are
complete it shall notify the University. The University may then inspect the
Sample Rooms and if the Employer's Agent is satisfied that the Sample Rooms
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comply with the Output Brief and Project Co's proposals he shall notify the parties
to this effect. The Employer's Agent shall digitally record the state, quality and
finish in the Sample Rooms and the parties agree that the Works Completion
Conditions will be deemed to be met insofar as they relate to Reviewable Design
relating to the Rooms if and to the extent they achieve the condition of the
completed Sample Rooms
33.1.7 (a) If and to the extent that Project Co has not completed the Sample Rooms on
or prior to the date which is six months prior to the Target Date for Section 1
Completion, the provisions of clauses 33.1.2-33.1.7 shall not apply
(b) If and to the extent that Project Co has not completed the Sample Rooms
on or prior to the date which is 15 weeks prior to the Target Date for
Phase 4 Completion in respect of County Fields Blocks A-E the
provisions of clauses 33.1.2-33.1.7 shall not apply
33.2 Record of Submissions
A record shall be kept by Project Co at a convenient location at or near the Construction Site
of all correspondence in relation to and submissions of Reviewable Design made by Project
Co and the University's response thereto made in accordance with the Design Development
Procedure, such record to be available for inspection by the University at all reasonable times
and upon reasonable prior notice.
33.3 University Sign Off
33.3.1 The University acknowledges and shall be deemed to accept that the design
contained in Project Co's Proposals as at the date of this Agreement satisfies the
Output Brief in respect of the University's Function Requirements. For the
avoidance of doubt the Parties agree that, subject to Clause 33.3.2, this
acknowledgement and deemed acceptance shall not apply to any element of the
design of the Works which is not shown on or described in Project Co's Proposals
as at the date of this Agreement.
33.3.2 A University Sign-Off Notice which has been issued or deemed to have been
issued under Schedule 1 (Design Development Procedure) shall constitute a
deemed acceptance on the part of the University that the relevant design satisfies
the Output Brief as elaborated by Project Co's Proposals (as at the date of issue or
deemed issue of the relevant University Sign-Off Notice) in respect of the
University Function Requirements. For the avoidance of doubt it is agreed by the
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Parties that this deemed acceptance shall not apply to any element of the design for
the Works which is not shown on or described in the design development proposal
which is the subject of the relevant University Sign-Off Notice.
33.3.3 Design proposals which are the subject of a University Sign-Off Notice shall, upon
the issue or deemed issue of such notice, automatically become part of Project Co's
Proposals.
33.3.4 Save to the extent otherwise provided in this Clause 33.3, no acknowledgement or
deemed acceptance given in Clauses 33.3.1 and 33.3.2 (including the issue or
deemed issue of a University Sign-Off Notice) shall reduce or exclude the
obligations of Project Co under this Agreement.
33.4 Project Co's Programmes
Project Co shall be responsible for preparing and maintaining the Construction Programme
and the Design Development Programme until the last Works Completion Date and shall
ensure that the University is provided at all times with a copy of each such programme (and
any revised versions) in machine readable format.
33.5 Design Development Programme
33.5.1 Project Co shall update the Design Development Programme whenever reasonably
necessary and in order to reflect extensions of time granted in accordance with
Clause 34 (Extensions of Time).
33.5.2 The Design Development Programme shall (inter alia):
(a) indicate to a reasonable level of detail the scope and quantity of the design
proposals to which the Design Development Procedure relates and which
will be submitted by Project Co during the period covered by the relevant
Design Development Programme;
(b) provide for the preparation, development, submission, review and

finalisation of the relevant design proposals in a reasonably systematic and
packaged form and on a reasonably phased basis; and
(c) identify the relevant time periods for the various steps which are to be taken
under the Design Development Procedure.
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33.5.3 In maintaining and updating the Design Development Programme Project Co shall
have due regard to the nature and relative importance of the various design
proposals which are to be prepared, developed and submitted, the implications the
same have or are likely to have on other parts of the designs to which the Design
Development Procedure relates and the amount of design information to be
considered during each relevant review period.
33.5.4 On no account shall any revision of the Design Development Programme shorten
the periods for consideration of design proposals by the University to a period of
less than 10 Working Days without the prior written approval of the University
such approval not to be unreasonably delayed.
33.5.5 Project Co shall, so far as reasonably practicable in the circumstances, prior to their
implementation consult with the University in relation to any revisions Project Co
proposes to make to the Design Development Programme but, in any event Project
Co shall not implement any alteration to the sequence for the submission and
review of design development proposals under the Design Development Procedure
without giving at least 10 Working Days' prior written notice to the University of
such alteration.
33.6 Construction Programme
33.6.1 Project Co shall ensure that the Construction Programme shows, from time to time,
the proposed sequence and timing for the execution and completion of the Works.
Such programme shall indicate all principal activities, including procurement and
the start and finish dates for each trade and the critical path network for achieving
completion of each Phase of the Works.
33.6.2 Project Co shall ensure that the Construction Programme is updated whenever
reasonably necessary and in order to reflect extensions of time granted in
accordance with Clause 34 (Extensions of Time) and Project Co shall promptly
provide the University with a copy of each such updated Construction Programme.
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34. EXTENSIONS OF TIME
34.1 Notice
If, at any time, Project Co becomes aware that a Delay Event has occurred or is likely to occur
and the progress of any Phase of the Works either has been or is likely to be impeded as a
result, Project Co shall as soon as reasonably practicable and in any event within 10 Working
Days provide the Employer's Agent and the University with such written information in
relation to the event as is at the time available to Project Co including:
34.1.1 details of the event together with a statement of whether in Project Co's opinion the
event constitutes or, if the event occurs, will constitute a Relief Event and/or a
Compensation Event;
34.1.2 an explanation of why the event does or does not constitute a Relief Event and/or
Compensation Event;
34.1.3 an explanation as to why the event has impeded or is likely to impede the progress
of any Phase of the Works;
34.1.4 an explanation of the effect or the likely effect of the event on any Phase of the
Works; and
34.1.5 an explanation of any measures that Project Co proposes or intends to take to

mitigate the consequences of the event.
34.2 Further Information
If Project Co receives or becomes aware of any further information relating to the Delay Event
(or the possible occurrence of the same) it shall submit such further information to the
Employer's Agent and the University as soon as reasonably practicable. Either the Employer's
Agent or the University may request from Project Co any further information which it may
reasonably require in order to assess properly the effect of the relevant event and Project Co
shall supply the same as soon as reasonably practicable and with reasonable care.
34.3 Extension of Time
34.3.1 If a Delay Event has occurred and the progress of any Phase of the Works or any
Section has been or is likely to be impeded as a result then, upon receipt by him of
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the notice and information referred to in Clauses 34.1 (Notice) and 34.2 (Further
Information), the Employer's Agent shall postpone the relevant Target Date(s) for
Phase Completion by such period or periods as is fair and reasonable in the
circumstances having regard to the extent to which the progress of the Works have
at that time been affected.
34.3.2 The occurrence of a Delay Event will not extend the Term nor (unless the Delay
Event is also a Compensation Event or Works Variation, (where such Works
Variations have been implemented) affect the provisions of Clause 35 (Alternative
Accommodation). In making his determination pursuant to this Clause 34
(Extension of Time) the Employer's Agent shall take account of the matters referred
to in Clause 34.2 (Further Information).
34.3.3 Without prejudice to any rights or remedies that the Parties may have against the
Employer's Agent, the Parties agree that any Dispute as to whether or not the
Employer's Agent has complied with its obligations pursuant to this Clause 34.3
(Extension of Time) shall in the first instance be determined by adjudication in
accordance with paragraph 4 of the Dispute Resolution Procedure.
34.4 Mitigation
Project Co shall and shall procure that the Contracting Associates shall use reasonable
endeavours in accordance with Good Industry Practice to mitigate the effect of a Delay Event
on the progress of the Works and shall consult with the University in relation to the same.
35. ALTERNATIVE ACCOMMODATION
35.1 The following provisions of this Clause 35 shall apply where in relation to a Phase of the
Works the relevant Works Completion Date has not occurred on or prior to the Target Date for
Phase Completion or where it is agreed between Project Co and the University, or determined
by the Employer's Agent, that the relevant Works Completion Date is not likely to occur on or
prior to the relevant Target Date for Phase Completion and in relation to the Phase 3 Works or
the Phase 4 Works the Works Completion Conditions for the relevant Section has not
occurred on or prior to the Target Date for Phase 3 Completion or the Target Date for Phase
4 Completion in each case in respect of that relevant Section or it is agreed between Project
Co and the University or determined by the Employer's Agent that the Works Completion
Conditions for the relevant Section are not likely to occur on or prior to the Target Date for
Phase 3 completion or the Target Date for Phase 4 Completion in each case in respect of
that Section provided that the provisions of this Clause 35 shall not apply where the
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Works Completion Conditions have not been met in respect of either the Retail Social
and/or Academic Space and/or the County West Demolition and Piazza Works.
35.2 For the purposes of this Clause 35 only in determining the relevant Target Date for Phase
Completion there shall be disregarded any extension of time to which Project Co is entitled
pursuant to the terms of Clause 34 (Extensions of Time) save for any extension of time relating
to a Compensation Event or a Works Variation where such Works Variation has been
implemented
35.3 In the circumstances set out in Clause 35.1 above
35.3.1 in the case of any Block or Blocks which is or are capable of safe and beneficial
occupation then such Block or Blocks shall be made available by Project Co to
house Students who have been allocated a Room by the University situate in the
relevant Phase of the Works
35.3.2 in the case of any Block or Blocks which, although not as a whole available for
beneficial occupation contain an Apartment or Apartments which is or are:
(a) capable of safe and beneficial occupation and
(b) contained within a Block which is due to be wholly available for safe and
beneficial occupation within four weeks of the commencement of the
Residences Year; and
(c) notwithstanding that the Works Completion Date has not occurred has its
own access, Kitchen Area in relation to each Room an Ensuite Bathroom
and the presence of the Availability Mandatory Elements, Utilities and the
Essential Fixtures Fittings and Equipment which comply with the relevant
requirements under Clause 36 (Tests on Completion)
then such Apartment or Apartments shall be made available by Project Co to

accommodate Students who have been allocated a Room by the University situate
in the relevant Phase of the Works.
35.4 Where the University has either Let intends to Let or has included in its offers to potential
Students at the University a guarantee of a Room in the relevant Phase of the Works
("Offered Rooms") and who cannot be accommodated in either a Block or an Apartment
pursuant to Clause 35.3 above then the University shall use all reasonable endeavours to
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ensure that the relevant Student enters into a Student Residence Agreement and agrees to the
provision of temporary accommodation until the Works Completion Date has occurred in
relation to the relevant Phase of the Works or the provisions of Clause 35.3 apply in relation to
such Offered Rooms whichever is the earlier.
35.5 In respect of any Offered Rooms where the Student has signed a Student Residence
Agreement in relation to the relevant phase of the Works then the University and Project Co
shall co-operate to jointly procure that such Students are found suitable temporary
accommodation until the Works Completion Date has occurred in relation to the relevant
Phase of the Works or the provisions of Clause 35.3 apply in relation to such Offered Rooms
whichever is the earlier and the Project Co shall bear the cost of provisions of such temporary
accommodation. In procuring alternative accommodation the parties shall use all reasonable
endeavours to minimise any costs to Project Co in procuring such alternative accommodation.
35.6 The obligation on the part of Project Co to assist in the provision of suitable temporary
accommodation and to bear the cost of provision of such shall cease on the Working Day
immediately following the occurrence of the Works Completion Date in respect of the
relevant Phase of the Works or the date that the provisions of Clause 35.3 apply to the Offered
Rooms whichever is the earlier.
35.7 In respect of any Offered Rooms where the Student has signed a Student Residence
Agreement then:
35.7.1 Project Co shall pay to the University the sum of as compensation to the
Student for inconvenience
35.7.2 the University shall be entitled to allow to the Student a discount in the relevant
Nominated Room Rate at the rate set out in the second column of the table in
Schedule 9 (Rate of Rental Discount) which corresponds to the period set out in the
first column of the table in Schedule 9 (Rate of Rental Discount) and Project Co
shall reimburse the University in respect of any such discount
35.7.3 Project Co shall where necessary reimburse the cost of reasonable transport for
Students between any alternative accommodation and the Lancaster University
Campus and the reasonable and proper removal costs incurred by Students in
relation to moving from the alternative accommodation to the Room in the Project
Co Accommodation.
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35.8 Where a Student is provided with alternative accommodation in respect of an Offered Room
then in addition to bearing the cost of such alternative accommodation Project Co shall pay
fair and reasonable compensation to the University (which the University shall pass on to the
affected Student) if the alternative accommodation is of a standard lower than an Offered
Room (having regard to quality, position and facilities available to it) such compensation to be
payable as a lump sum payment on the earlier of the Works Completion Date or where the
provisions of Clause 35.3 apply whichever is the earlier.
35.9 The compensation as referred to in Clause 35.8 shall not exceed the difference between the
cost of providing the alternative accommodation and the Nominated Room Rate for the
Offered Room for the period in question and no compensation shall be payable if the cost of
the alternative accommodation is the same as or exceeds the amount of the Nominated Room
Rate received by Project Co for the Offered Room for the period in question:
35.10 If the University has vacant usable accommodation within the University Residential
Accommodation which is not itself let or has been included in its offer to potential students
and Project Co needs to arrange alternative accommodation the University will upon request
make it available to Project Co provided that such use does not prejudice the University's
plans for letting or using that accommodation. Project Co shall pay an amount equal to the
Nominated Room Rate for the period of any such use and the provisions of Clause 35.7 shall
apply but no payment of compensation under Clause 35.8 shall in such circumstances be
payable.
35.11 In the event that any Block or Blocks or any Apartment or Apartments are made available by
Project Co to house Students in accordance with Clause 35.3 then the provisions of the
relevant Underlease shall apply to such Block or Blocks or such Apartment or Apartments and
the University and Project Co shall comply with the provisions of the relevant Underlease
(including the payment of the University Accommodation Charge) as if it had been granted in
respect of those parts of the Premises or in respect of any Student Residence Agreement which
has been entered into pursuant to this Clause 35.
35.12 In respect of any Offered Rooms where the Student has, notwithstanding Clause 35.3, refused
to sign a Student Residence Agreement then Project Co shall pay to the University in full
and final settlement but without prejudice to the rights pursuant to the Agreement if the
relevant Works are not completed by the relevant Longstop Date for Phase Completion for
each such Student on the date that the Student signs an agreement for accommodation
elsewhere.
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35.13 Any breach of the provisions of this Clause 35, save where such arise out of a Compensation
Event or Works Variation, shall not constitute an Excusable Breach.
35.14 DELAYS TO RETAIL, SOCIAL AND ACADEMIC SPACE
35.14.1 If the Phase 4 Works County Main Completion Date has not occurred on or
prior to the Target Date for Phase 4 Completion in respect of the Section
comprising County Main then Project Co shall not be required to provide
alternative accommodation in respect of the Retail, Social or Academic Space
and any rental payable in respect of the Retail Social or Academic Space
pursuant to the County Underlease and/or the provisions of schedule 13 (the
University Accommodation Charge and Performance Measurement System)
shall not be payable for the period from the Target Date for Phase 4
Completion in respect of the Section comprising County Main up to and
including the Phase 4 Works County Main Completion Date.
35.14.2 In relation to the County Field Works, the provisions of clauses 35.1 to 35.13
apply subject to:
(a) clause 29.3.3, so that where the University is not obliged to deliver
vacant possession of County Main, clauses 35.1 to 35.13 do not apply
until the University is obliged to deliver vacant possession of County
Main; and
(b) a direction from Project Co under clause 29.3.5, so that where the
University is not obliged to procure that Students accept alternative
accommodation under clause 29.3.4(b), clauses 35.1 to 35.13 do not
apply in relation to the Rooms in respect of which the direction under
clause 29.3.5 is made.
35.14.3 If and to the extent Project Co is in receipt of proceeds under the Delay in
Start Up Insurance policy as more particularly set out in schedule 18 to this
Agreement, the University acknowledges that Project Co may be under an
obligation in accordance with clause 24.14 of the Building Contract to
reimburse to the Building Contractor the amount of liquidated and
ascertained damages paid or allowed by the Building Contractor under the
Building Contract up to the amount of the insurance proceeds received by
Project Co
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36. TESTS ON COMPLETION
36.1 Project Co shall give five (5) Working Days' prior written notice to the University and the
Employer's Agent of the commencement of the Tests on Completion in relation to each Phase
of the Works (including any Sections).
36.2 Project Co shall permit the University and the Employer's Agent to witness the carrying out of
the Tests on Completion in relation to each Phase of the Works and shall provide them with
all information they may reasonably require in relation thereto.
36.3 Project Co shall carry out the Tests on Completion and shall provide such labour, materials,
stores, test equipment, tools, instruments, apparatus and assistance as are reasonably required
for the Tests on Completion.
36.4 The results of the Tests on Completion shall be presented in a report produced by Project Co
in each case after the completion of the Tests on Completion in relation to each Phase of the
Works. Project Co shall promptly deliver a copy of the report to the Employer's Agent and
the University.
36.5 If any Phase (or Section) of the Works fails to pass the applicable Tests on Completion (or any
repetition thereof in the event of prior failure) then Project Co shall:
36.5.1 ascertain the cause of such failure;
36.5.2 carry out the necessary rectification work; and
36.5.3 carry out again the failed Tests on Completion and supply the results of the relevant
Tests on Completion to the Employer's Agent and the University.
36.6 Each Party shall bear its own costs in relation to the Tests on Completion.
37. WORKS COMPLETION CERTIFICATES
37.1 Project Co shall give to the University and the Employer's Agent not less than fifteen (15)
Working Days' notice of the date upon which Project Co considers that the Works Completion
Conditions will be satisfied in relation to each Phase of the Works (including any Section).
37.2 When Project Co is of the opinion that the Works Completion Conditions have been satisfied,
in relation to the relevant Phase of the Works and in relation to the Phase 3 Works or the
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Phase 4 Works the relevant Section, it shall forthwith notify the Employer's Agent and the
University of the same.
37.3 Subject to Clause 37.6, once the Works Completion Conditions have been satisfied in relation
to each Phase of the Works and in relation to the Phase 3 Works or the Phase 4 Works the
relevant Section the Employer's Agent shall, within two (2) Working Days of his receipt of
Project Co's notice given under Clause 37.2, issue a certificate to the Parties (the "Works
Completion Certificate") stating the date upon which the Works Completion Conditions
have been satisfied in relation to the relevant Phase of the Works or in relation to the Phase 3
Works or the Phase 4 Works the relevant Section (as appropriate).
37.4 Subject to Clause 37.6, if the Works Completion Conditions have not been satisfied, the
Employer's Agent shall, within two (2) Working Days of his receipt of Project Co's notice
given under Clause 37.2, notify the University and Project Co of this fact. At the same time as
such notification the Employer's Agent shall provide to the University and Project Co a report
setting out the respects in which he considers that the Works Completion Conditions have not
been satisfied in relation to the relevant Phase of the Works.
37.5 If the Employer's Agent provides a report pursuant to Clause 37.4, Project Co shall, when it is
of the opinion that each of the matters referred to in the Employer's Agent's report have been
satisfied, notify the Employer's Agent and the University of the same and thereafter the
procedures set out in Clauses 37.2 and 37.4 (inclusive) shall be repeated until the Works
Completion Certificate is issued in relation to the relevant Phase of the Works (or Section) or
it is determined by the Adjudicator that the relevant Works Completion Certificate should
have been issued.
37.6 The Parties agree that the Employer's Agent shall issue each Works Completion Certificate
notwithstanding the existence of Snagging Matters.
37.7 If the Employer's Agent fails to issue a Works Completion Certificate in accordance with
Clause 37.3 and Project Co wishes to challenge the same or if there are certain aspects of the
Employer's Agent's report issued pursuant to Clause 37.4 which Project Co wishes to
challenge:
37.7.1 Project Co shall be entitled to refer the matter for determination by an Adjudicator
under the Disputes Resolution Procedure as if it constituted a Dispute (save that the
Adjudicator's decision shall be notified to the Parties within twenty eight (28) days
of referral of the Dispute to him and such decision shall be final and binding on the
Parties with no right for either Party to refer the Dispute to the Courts), provided
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that the Employer's Agent's report or his decision not to issue the Works
Completion Certificate shall be final and binding on Project Co unless Project Co
has referred the matter as aforesaid within 10 Working Days of receipt of the
notification and report from the Employer's Agent pursuant to Clause 37.4 that it
considers that the Works Completion Conditions have not been satisfied; and
37.7.2 following any reference to an Adjudicator under Clause 37.7.1, Project Co shall be
entitled, at its own risk and at no additional cost to the University, to execute and
complete any Works necessary to satisfy the Works Completion Conditions.
37.8 If the Employer's Agent issues a Works Completion Certificate and the University wishes to
challenge the issue of that Works Completion Certificate, the University shall be entitled to
refer the matter for determination by an Adjudicator under the Dispute Resolution Procedure
as if it constituted a Dispute, (save that the Adjudicator's decision shall be notified to the
Parties within twenty eight (28) days of referral of the Dispute to him and such decision shall
be final and binding on the Parties with no right of either Party to refer the Dispute to the
Courts) provided that the Works Completion Certificate shall be final and binding on the
University unless the University has referred the matter as aforesaid within 10 Working Days
of receipt of the said Works Completion Certificate.
38. SNAGGING MATTERS
38.1 Snagging Matters
38.1.1 At the time Project Co provides its notice pursuant to Clause 37.1 Project Co shall
provide to the Employer's Agent (copied simultaneously to the University) a draft
list of all Snagging Matters that it anticipates will be included in the Snagging
Notice.
38.1.2 Where Project Co has given a notification to the University and the Employer's
Agent pursuant to Clause 37.2, the Parties agree that the relevant Works
Completion Certificate shall be issued notwithstanding the fact that the Works
Completion Conditions have not been satisfied provided that the respects in which
the Works Completion Conditions have not been satisfied do not, either
individually or collectively, adversely affect the beneficial occupation and use of
the relevant part or parts of the Project Co Accommodation (the "Snagging
Matters").
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38.1.3 To the extent that Snagging Matters exist the Employer's Agent shall notify the
Parties of the Snagging Matters (a "Snagging Notice") within 2 Working Days of
the date on which the relevant Works Completion Date is certified or (if later)
within 2 Working Days of the date on which it is determined by the Adjudicator
under the Dispute Resolution Procedure that such date should have been certified
and such notification shall categorise the Snagging Matters and applicable remedial
periods as follows:
Category Remedial Period

(a) Urgent 2 Working Days
(b) Routine 10 Working Days
(c) Planned During the next appropriate
Vacation Period
Such remedial periods in the case of (a) and (b) above shall run from receipt by
Project Co of the Snagging Notice from the Employer's Agent and the Snagging
Matters shall be attended to or remedied (as the case may be) as soon as reasonably
possible but in any event within the requisite remedial periods and to the standards
required by this Agreement.
38.1.4 The University hereby grants licence to Project Co and those authorised by Project
Co to enter upon and occupy such parts of the Project Co Accommodation as may
be reasonably necessary to enable Project Co to comply with its obligation to
remedy Snagging matters within the prescribed remedial periods in accordance
with Clause 38.1.3.
38.2 Progress
38.2.1 The Parties agree that the Employer's Agent shall notify them every 10 Working
Days of the progress in respect of all Snagging Matters. Once all Snagging Matters
have been attended to, to the standards required by this Agreement, the Employer's
Agent shall notify the Parties of the same.
38.2.2 If Project Co has not attended to the Snagging Matters to the standards required by
this Agreement within the requisite remedial periods identified in Clause 38.1.3,
the University shall be entitled to attend to such Snagging Matters provided that:
(a) the University shall give Project Co reasonable notice before doing so; and
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(b) any reasonable costs recoverable by the University may be recovered from
sums standing to the credit of Project Co under this Agreement.
39. UNIVERSITY OPERATIONS
The University shall give Project Co reasonable prior notice of any material changes to the
University's Development Programme and without prejudice to such obligation to notify, the
University shall not materially change the University's Development Programme where
Project Co demonstrates to the reasonable satisfaction of the University that the material
change to the University's Development Programme will or is reasonably likely as a
consequence to result in Project Co incurring material additional cost or suffering material
damage or loss in carrying out and completing the Works or any Phase of the Works and that
Project Co could not by taking such reasonable mitigating action as would be consistent with
Good Industry Practice avoid incurring such cost or suffering such damage or loss.
40. COLLATERAL WARRANTIES
Upon execution and delivery of this Agreement Project Co shall deliver to the University
collateral warranties executed as deeds by the Building Contractor in relation to (a) the
Infrastructure Works and (b) the remainder of the Works and by the Employer's Agent in the
forms set out in Schedule 6 (Collateral Warranties), Parts 1, 2 and 3 respectively and by the
Hard FM Contractor in the form set out in Schedule 6 (Collateral Warranties), Part 4. The
University acknowledges that the collateral warranties delivered to the University pursuant to
this Clause 40 shall replace those issued to the University on or around 28 March 2003 in
relation to Phase 1, which warranties shall then cease to be of any effect.
41. RELIEF EVENTS
41.1 The University may not rely upon a ground for termination of the Project Documents to the
extent that it arises from a Relief Event and Project Co shall not be in breach of its obligations
under the Project Documents to the extent that it is unable to perform or it is delayed in
performing any of its obligations in whole or in part by reason of a Relief Event.
41.2 For the avoidance of doubt the grant of relief pursuant to this Clause 41 shall not:
41.2.1 affect the University's entitlement to make Deductions; and
41.2.2 relieve Project Co from its obligations pursuant to Clause 35 (Alternative

Accommodation) of this Agreement.
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41.3 The provisions of Clause 34 (Extensions of Time) shall apply in relation to the Works.
41.4 Project Co shall:
41.4.1 within 10 Working Days of the occurrence of a Relief Event or if later the date
upon which Project Co became aware of the Relief Event, notify the University of
that occurrence such notice to include details of the Relief Event, its effect on the
obligations of Project Co, the date or likely date of occurrence of the Relief Event
and its likely duration.
41.4.2 within 10 Working Days of receipt by the University of the notice referred to in
Clause 41.4.1 above provide to the University details of the relief claimed in
respect of that Relief Event.
41.5 Project Co shall following the occurrence of a Relief Event or, if later, upon its becoming
aware of the same use reasonable endeavours to mitigate the effects of any delay and Project
Co shall whilst a Relief Event is subsisting take reasonable steps in accordance with Good
Industry Practice to overcome or minimise the consequences of the Relief Event.
41.6 Project Co shall notify the University as soon as practicable after the Relief Event ceases or no
longer causes Project Co to be unable to comply with its obligations under the Project
Documents.
41.7 If the Parties fail to agree the extent of the relief required, or the University disagrees that a
Relief Event has occurred, the matter shall be referred for determination pursuant to the
Liaison and Disputes Resolution Procedure.
41.8 The Term shall not extend as a result of any Relief Events.
42. COMPENSATION EVENTS
42.1 General
42.1.1 Upon the occurrence of a Compensation Event Project Co shall be entitled to seek
Compensation Losses in accordance with the provisions of Clauses 42.2 to 42.5.
42.1.2 Project Co shall not be in breach of its obligations under this Agreement or any
other Project Document to the extent that it is unable to perform or is delayed in
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performing that obligation in whole or in part by reason of a Compensation Event
(or the consequences thereof). If the obligation which Project Co is unable to
perform by reason of the Compensation Event is required to be performed within a
specified time period Project Co shall be entitled to such extension of time as is
reasonable in all the circumstances.
42.1.3 The University may not rely upon a ground for termination of the Project
Documents to the extent that it arises from a Compensation Event.
42.1.4 The provisions of Clause 34 (Extensions of Time) shall apply in relation to the
Works.
42.2 Notice
42.2.1 If at any time Project Co becomes aware that a Compensation Event has occurred
or is likely to occur it shall as soon as reasonably practicable notify the University
of this fact.
42.2.2 Within 10 Working Days of receipt by the University of the notification referred to
in Clause 42.2.1 Project Co shall provide to the University a written report (the
"Initial Report") setting out details of the relevant event including:
(a) details of the event together with a statement of whether in Project Co's
opinion the event constitutes or, if the event occurs, will constitute a
Compensation Event;
(b) an explanation of why the event constitutes a Compensation Event; and
(c) an explanation of any measures Project Co proposes or intends to take to

minimise any costs to the University arising from the event.
42.2.3 Within 10 Working Days of receipt by the University of the Initial Report Project
Co shall provide the University with full written details (the "Compensation Event
Report") of the relevant event including:
(a) details relating to the matters set out in the Initial Report of which it has
become aware since providing the Initial Report;
(b) Project Co's estimate of any Compensation Losses; and
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(c) any other details which Project Co considers to be relevant.
42.3 Further Information
If Project Co receives or becomes aware of any further information relating to a Compensation

Event it shall as soon as reasonably practicable submit such further information to the
University. The University may request from Project Co any further information which it may
reasonably require in connection with a Compensation Event and Project Co shall supply the
same within a reasonable period after such request and with reasonable care.
42.4 Adjustment
Within 10 Working Days of receipt by the University of the Compensation Event Report the
University shall confirm to Project Co whether or not it accepts the same. If the University
does not accept the same:
42.4.1 the University may discuss with Project Co any unagreed matters with a view to
securing revisions to the Compensation Event Report acceptable to both Parties;
and
42.4.2 either Party may refer any unagreed matters for determination pursuant to the
Liaison and Disputes Resolution Procedure.
Upon such agreement or, in default of agreement, upon determination of the same pursuant to
the Liaison and Disputes Resolution Procedure, Project Co shall be relieved of its obligations
under the Project Documents with effect from date of the relevant event to the extent required
and the University shall pay to Project Co the applicable Compensation Losses (as and when
they are actually incurred by Project Co) within 10 Working Days after receipt of an invoice
supplied by Project Co together with such supporting information as may be reasonable in the
circumstances.
42.5 Mitigation
Project Co shall and shall procure that the Contracting Associates shall use all reasonable
endeavours in accordance with Good Industry Practice to minimise any costs to the University
arising from a Compensation Event, and shall where practicable consult with the University in
relation to the same.
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43. INFRASTRUCTURE
43.1 (a) Subject to Clause 43.1(b), where the University so elects and pays the Infrastructure
Contribution to Project Co, then:
(i) Project Co shall transfer the ownership of the Infrastructure Works

(ownership and title to which the University acknowledges is vested in
Project Co in which respect the University will enter into a confirmatory
document if reasonably so requested by Project Co) to the University (and
Project Co shall (save in relation to any ongoing legal proceedings) be
released from all further and previously accrued liabilities and obligations in
relation to the Infrastructure Works (including any liability for defects or
deficiencies in them) on the relevant Works Completion Date, provided that
Project Co has first procured the delivery to the University of the collateral
warranty from the Building Contractor in relation to the Infrastructure Works
pursuant to its obligation in Clause 40 (Collateral Warranties) of this
Agreement; and
(ii) the provisions of Part 2 of Schedule 16 shall take effect.
For the avoidance of doubt Project Co shall not be obliged to transfer ownership of
the Infrastructure Works to the University until such time as it receives the
Infrastructure Contribution, but shall still be obliged to procure the delivery to the
University of the collateral warranty from the Building Contractor referred to above
pursuant to its obligation in Clause 40 (Collateral Warranties).
(b) Where the Infrastructure Contribution is less than

exclusive of any VAT then it shall be in Project Co's sole discretion whether to accept
the Infrastructure Contribution and to transfer the ownership of the Infrastructure
Works.
43.2 The University may elect to pay the Infrastructure Contribution to Project Co at any time on or
before commencement of Residence Year 2007 by written notice to Project Co and shall,
having served such notice, pay the Infrastructure Contribution to Project Co for value on or
before the commencement of Residence Year 2007. If the University serves a notice under
this Clause 43.2 and pays the Infrastructure Contribution to Project Co for value on or before
the commencement of Residence Year 2007 then, subject to Clause 43.1(b), the Infrastructure
Variation shall take effect.
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43.3 The University covenants to keep the University Infrastructure which serve the Premises in
such state of repair and condition as shall be necessary for the beneficial occupation and use of
the Premises in accordance with the relevant Headleases and, whilst they subsist, the relevant
Underleases.
43.4 Utilities
43.4.1 Subject to Clauses 43.4.3 and 43.4.4 at all times during the Term the University
shall supply or procure the supply of Utilities to the Accommodation and/or the
Core Accommodation.
43.4.2 Whilst the Underleases are subsisting, the University shall pay and indemnify
Project Co against all costs relating to the supply of Utilities to the Accommodation
and/or the Core Accommodation and their consumption.
43.4.3 If there is any loss or interruption of any of the Utilities or insufficient Utilities
capacity due to a failure outside the University's reasonable control, the University
shall use all reasonable endeavours to provide to the Accommodation and/or the
Core Accommodation the same emergency facilities as are provided to the
University under any contract with a utility supplier and the University shall use all
reasonable endeavours to procure the reinstatement of supply as soon as reasonably
practicable, but the University shall not otherwise be liable for any such loss or
interruption.
43.4.4 To the extent that the University is entitled to any compensation from a third party
in relation to any loss or interruption of the Utilities and receives such
compensation (which it shall use reasonable endeavours to recover) it shall pay to
Project Co a fair and reasonable proportion of such compensation so far as it relates
to and is attributable to the loss or interruption of utilities suffered by Project Co
43.4.5 Subject to any confidentiality provisions, the University shall provide to Project Co
copies of all relevant extracts of all contracts entered into by it from time to time
with utility suppliers so that Project Co is aware of the emergency arrangements (if
any) in place for the supply of Utilities.
43A Foul Water Sewer Connection Works
43A.1 In this Clause 43A the following expressions shall have the following meanings:-
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"Agreed Brief" means the survey by Shepherd Gilmour Infrastructure Limited of the
University's existing infrastructure using dye tracing in order to determine where the
University's surface water flows discharge and which have been forwarded to the Facility
Agent's Technical Adviser for their review and comment;
"Foul Water Sewer" means the foul water sewer on the SW campus;
"Remediation Report" has the meaning given to that expression in Clause 43A.2;
"Remediation Timetable" the timetable specified for the carrying out and completion of the
Remediation Works by Shepherd Gilmour Infrastructure Limited;
"Remediation Works" means the steps to be taken (both interim and final) and the works
necessary as identified by Shepherd Gilmour Infrastructure Limited to resolve the potential
problems associated with the current connection of Surface Water Drainage System to the Foul
Water Sewer;
"Surface Water Drainage System" means those parts of the University's surface water system
currently discharging surface water into the Foul Water Sewer.
43A.2 No later than 31 December 2003 the University shall deliver a technical report (the
"Remediation Report") in response to the Agreed Brief setting out the proposed
Remediation Works and the Remediation Timetable (in which respect the University intends
to procure the carrying out of the Remediation Works as soon as reasonably practical after the
appropriate measures have been identified).
43A.3 The University shall liaise and consult with Project Co and its advisors (including the Facility
Agent's Technical Adviser at all stages in relation to the content and the carrying out of the
Remediation Works and the Remediation Timetable and shall take reasonable account of all
representations and comments that such parties shall make to the University.
43A.4 Once the Remediation Works and the Remediation Timetable have been agreed the
University shall procure that the Remediation Works are carried out at the sole cost and
expense of the University in a good and workmanlike manner using all reasonable skill and
care and in accordance with the Remediation Timetable. Project Co and its advisors (as
aforesaid) shall have the right to be present at site meetings and at the visit to determine
whether the Remediation Works are practically complete.
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43A.5 Any dispute as to whether the University is complying with its obligations pursuant to clause
43A.4 shall be determined by an Expert in accordance with the Liaison and Disputes
Resolution Procedure.
43A.6 Where it has been agreed or determined that the University is not complying with its
obligations pursuant to Clause 43A.4 then Project Co shall notify the University in writing of
the following:-
43A.6.1 the action it wishes the University to take in order to comply with the
Remediation Timetable and/or the carrying out of the Remediation Works;
43A.6.2 the reason for such action and a reasonable period of time within which the
University is to take such action;
43A.6.3 the date it wishes the University to commence such action;
43A.6.4 the time period which it believes will be necessary for such action.
43A.7 Following service of a notice under Clause 43A.6 the Project Co and the University shall seek
to agree the action required to be taken by the University and failing agreement of the same
the matter shall be referred for determination by an Expert pursuant to the Liaison and
Disputes Resolution Procedure.
43A.8 If following agreement or determination of the action required to be taken by the University
the University does not notify Project Co that it will take such action within a reasonable
period of receiving any notice, or does not (having given such a notice) carry out such action
within a reasonable time, the Project Co shall be entitled to take such action itself.
43A.9 The University shall reimburse Project Co the reasonable and proper costs of the Project Co
in taking such action upon such costs being agreed or determined.
43A.10 Where the Project Co takes the action referred to in Clause 43A.7 itself the University shall
give all reasonable assistance to the Project Co (as requested by the Project Co) while it is
taking such action.
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Part 6 – Assignment, Change of Control and Change of Lenders
44. ASSIGNMENT
44.1 Binding on Successors and Assigns
The Project Documents shall be binding on and shall enure for the benefit of Project Co and
the University and their respective successors and permitted assigns.
44.2 Assignment by Project Co
Project Co shall not assign, transfer or otherwise dispose of all or any of its rights, benefits or
obligations under the Project Documents without the prior written consent of the University.
44.3 Assignment by the University
44.3.1 Save as provided in Clauses 44.4 to 44.11, the University shall not during the
Primary Period or where the Work-Out Arrangements or the University
Triggered Work-Out Arrangements or the Instalment Arrangements apply,
assign transfer or otherwise dispose of all or any of its rights benefits or obligations
under the Project Documents.
44.3.2 The provisions of Clauses 44.4-44.11 shall not apply and the University shall
be free to assign transfer or otherwise dispose of all or any of its obligations
under the Project Documents to any other University or other higher
education institution without the requirement for consent of Project Co at any
time during which the Secondary Period (Non Default) Arrangements apply.
Arrangements in relation to Proposed Transactions and Transactions
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44.5.1 it being agreed or determined that it has met all of the Transaction Conditions; and
44.5.2 obtaining the prior written consent of Project Co (such consent not to be
unreasonably withheld where Clause 44.5.1 is complied with).
44.6 Transaction Conditions
The Transaction Conditions which must be satisfied (to be specified as part of the detail
submitted in its University Proposed Transaction Notice) are as follows:-
44.6.1 that the University has an Approved Credit Rating;
44.6.2 that the Transaction will not have a Material Adverse Effect;
44.6.3 that the Transaction will not have the effect of reducing the number of Attending
Students (forecast over each of the following five Residence Years ("Transaction
Forecast Period") below the Attending Student Level Floor for any Residence
Year in the Transaction Forecast Period.
44.7 University Proposed Transaction Notice
In the event that any member of the University Group wishes (or is required by Legislation) to
enter into a Transaction then as soon as it becomes aware of the same the University shall
deliver a notice (a "University Proposed Transaction Notice") to each of:
44.7.1 Project Co;
44.7.2 the Security Trustee; and
44.7.3 the Facility Agent
and such Proposed Transaction Notice shall contain the following information ("Proposed
Transaction Data") for the Proposed Transaction:-
(a) details to support the University's contention that each of the Transaction Conditions
has been met;
(b) details of the proposed Successor Establishment or purchaser of the assets;
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(c) the intended closing date of the Proposed Transaction;
(d) the key commercial terms of the Proposed Transaction
(e) the draft business plan (if applicable) for the Successor Establishment;
(f) financial and other relevant information relating to the Successor Establishment;
(g) the projected Attending Student Level following completion of the Proposed
Transaction for the Transaction Forecast Period;
(h) details of any other consents required to the Proposed Transaction; and
(i) other information reasonably requisite in the circumstances of the Proposed

Transaction.
44.8 Parties to meet
Within 10 Working Days of receipt of the University Proposed Transaction Notice the
University and Project Co shall meet in order to:-
44.8.1 identify any further Proposed Transaction Data which Project Co may reasonably
require in relation to the proposed Transaction in order to respond formally to the
University Proposed Transaction Notice;
44.8.2 engage in good faith discussions (but not so as to oblige Project Co to approve any
Proposed Transaction unless the requirements of Clause 44.5 are met and not to
oblige the University to agree any revisions where the requirements of Clause 44.5
have been met) to assess the likely impact of the Transaction on the parties in the
light of the provisions of the Project Documents and to identify whether there are
any mutually acceptable revisions which could be made in order to preserve the
positions of both parties under the Project Documents in the event that the
Transaction proceeds.
44.9 Project Co Transaction Response
Within 30 Working Days of receipt of the University Proposed Transaction Notice (or, if later,
within 20 Working Days of receiving all information reasonably required by Project Co in
order to make a decision as to whether to approve the Transaction) Project Co shall notify the
University in writing as to:-
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44.9.1 whether it considers (acting reasonably) that the Transaction Conditions have been
satisfied for the relevant Proposed Transaction (or retrospectively have been
satisfied if the Transaction has already taken place); and
44.9.2 (in the case of a Voluntary Major Disposal or Voluntary Merger) whether it
consents to the Proposed Transaction pursuant to Clause 44.5.2.
For the avoidance of doubt, any approval given by Project Co shall be strictly subject to the
University securing any other necessary consents to the Transaction from any relevant third
parties.
44.10 Disputes
Any dispute to whether the Transaction Conditions have been met shall be determined by an
Expert pursuant to the provisions of the Liaison and Disputes Resolution Procedure.
44.11 Project Co's ability to terminate and level of compensation
In the event that the University proceeds with an Obligatory Major Disposal or an Obligatory
Merger which does not satisfy any of the Transaction Conditions (as determined prospectively
in the case of a University Proposed Transaction Notice or retrospectively if the relevant
Transaction has already occurred) then Project Co shall be entitled to immediately terminate
the Project Documents by serving notice in writing to that effect upon the University in
accordance with the provisions of Clause 49.9.2 in which event the provisions of Clauses 50
and 51.1.9 shall apply.
44.12 Attending Students numbers review
In the event that the University proceeds with a Transaction, Project Co shall be entitled to
call for a review of the impact of that Transaction on the number of home Attending Students
as a percentage of all Attending Students and to call for a revision with immediate effect to the
then current calculation of the Attending Student Level such revision to be agreed between
the parties (acting reasonably).
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45. DEALING IN SHARES AND CHANGE OF LENDERS
45.1 Share Ownership
Project Co represents and warrants that, at the date of this AgreementPhase 4 Effective Date
and subject to the interests of the Senior Lenders under the Financing Agreements, Jarvis
PLCUPP Investments and Alma Mater Fund Limited Partnership are the legal and beneficial
owners of all of the shares in Holdco and that they are owned in the following proportions:
Jarvis Plc 50% UPP Investments and Alma Mater Fund Limited Partnership 50%.
45.2 Transfer of Shares and Change of control
Project Co shall procure that prior to the date which is five (5) years after the Phase 3last
Works Completion Date (or if Clause 52.7 applies the Phase 4 Works Completion Date)to
occur:
45.2.1 that Jarvis PlcAlma Mater Fund Limited Partnership or the Alma Mater
Group do not hold less than 50% of the issued share capital of Holdco unless the
consent of the University has been obtained such consent not to be
unreasonably withheld and which for the avoidance of doubt be deemed to be
reasonably withheld where there is an Adverse Reputational Effect;
45.2.2 that there is no issue of further shares in Project Co and/or Holdco (save to the
shareholders pro rata to their shareholdings);
45.2.3 that Project Co continues to be a wholly owned subsidiary of Holdco.
45.3 Project Co shall procure that for the period from the date which is five (5) years after the
Phase 3last Works Completion Date (or if Clause 52.7 applies, the Phase 4 Works Completion
Date) and until the Term Expiry Date there shall be no transfer of the legal ownership or the
operation of a trust in respect of any of the shares owned in Holdco by Jarvis Plc without the
consent of the University provided that the University shall only be able to withhold its
consent where there are material and reasonable grounds for the University to object to such
transfer or operation of a trust because it would have an Adverse Reputational Effect.
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45.4 Notification of Transfer of Shares and Change
45.4.1 Project Co shall notify the University in writing at least ten Working Days prior to
any proposed transfer of shares referred to in Clauses 45.2 and 45.3 above.
45.4.2 Where the University objects to the transfer of such shares for any of the reasons
set out in Clauses 45.2 and 45.3 above then such transfer shall not take place until
the parties have agreed to the same.
45.4.3 Any Dispute as to whether the provisions of Clauses 45.2 or 45.3 apply shall be
determined by an Expert pursuant to the Liaison and Disputes Resolution
Procedure.
45.5 Change in Lenders
45.5.1 Project Co shall promptly on becoming aware of the same, notify the University in
writing of the change in the identity of, or of the addition of:
(a) any person which provides funding or other financial facilities (whether
directly or indirectly) to Project Co; or
(b) any person which guarantees the repayment of any funding or other
financial facilities which are made available (whether directly or indirectly)
to Project Co.
45.5.2 Project Co shall from time to time upon the occurrence thereof notify the
University of any events of default or potential events of default howsoever
described under the Financing Agreements (which have not been remedied within
the appropriate cure period or waived by the relevant Senior Lender) and of any
action taken by any person in relation thereto.
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- 145 -
- 146 -
- 147 -
46.9 Amendments to Project Documents
If as a result of any Refinancing the Senior Lender's Direct Agreement shall cease to have
effect (in this Clause 46.9 a "Relevant Refinancing") the University and Project Co shall
make such amendments to Part 9 and Schedule 20 as shall be necessary to incorporate the
provisions of the Senior Lender's Direct Agreement referred to in such provisions so that Part
9 and Schedule 20 shall continue to have effect following a Relevant Refinancing and the
parties shall make such other necessary consequential amendments including and/or replacing
references to the Financing Arrangements as shall be necessary to ensure the continued
effectiveness of the Project Documents and (ii) that the Project Documents shall have the
same overall economic effect. The amendments required by this Clause 46.9 shall take effect
on a Relevant Refinancing and if the parties cannot agree then the matter shall be submitted
for determination by an Expert pursuant to the Dispute Resolution Procedure.
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Part 8 - Variations and Change in Legislation
47. VARIATIONS
The provisions of Schedule 16 (Variations) shall apply in relation to Variations
48. CHANGES IN LEGISLATION
Project Co and the University shall comply with their respective obligations contained in
Schedule 17 (Change in Legislation)
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Part 9 - Default and Termination of the Primary Period Arrangements
49. TERMINATION OF THE PRIMARY PERIOD ARRANGEMENTS
49.1 Events of Project Co Default and the University's Right to Terminate the Primary
Period Arrangements
49.1.1 Notification of Events of Default
Project Co undertakes that it shall notify the University of the occurrence of any
Event of Project Co Default promptly upon Project Co becoming aware of the
occurrence thereof. Any such notification shall include reasonable details of the
circumstances giving rise to the delivery of the notice.
49.1.2 Actions following an Event of Project Co Default
(a) If an Event of Project Co Default has occurred then, if the Event of Project
Co Default is a Remediable Default, the University shall serve on Project
Co a Remediation Notice.
(b) If an Event of Project Co Default has occurred which is not a Remediable

Default, or in relation to a Remediable Default Project Co has not complied
with the Remediation Notice, then (subject to Project Co's right under
Clause 50.2) the University shall be entitled to serve a notice (a "Final
Termination Notice") on Project Co and the provisions of Clause 49.1.3
below shall apply.
49.1.3 Effect of Termination of the Primary Period Arrangements for an Event of

Project Co Default
Where the provisions of Clause 49.1.2(b) above apply then:
(a) the provisions of the Senior Lenders' Direct Agreement shall apply; and
(b) for the period from the Final Termination Notice until the earlier of:
(i) agreement or determination that there exists either a Viable Work-

Out Solution or Non-Acceptable Repayment Terms pursuant to the
provisions of the Senior Lenders' Direct Agreement; or
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(ii) commencement of any Remedy Programme agreed or determined
pursuant to the Senior Lenders' Direct Agreement; or
(iii) the Senior Lenders' Direct Agreement ceasing to apply pursuant to

Clause 8.3 of the Senior Lenders' Direct Agreement
the provisions of this Agreement and the Project Documents shall remain in
full force and effect;
(c) where it has been agreed or determined pursuant to the Senior Lenders'
Direct Agreement that a Viable Work Out Solution exists then the
provisions of this Agreement and the Project Documents shall remain in
full force and effect, as varied to reflect the Secondary Period Work-Out
Arrangements and the provisions of paragraph 15 of Part 1 of Schedule 13
shall apply;
(d) where it has been agreed or determined that there are Non-Acceptable
Repayment Terms then the provisions of Part B of Schedule 20 shall apply.
49.2 University's right to voluntarily terminate the Project Documents
The University shall be entitled upon not less than 12 months notice to expire not earlier than
the end of the relevant Residence Year following the date upon which such notice is served to
terminate the Project Documents whereupon the provisions of Clauses 50 (Effects of
Termination) and 51.1.1 (Consequences of Termination) shall apply.
49.3 University's right to terminate the Primary Period Arrangements or the Secondary
Period (Non Default) Arrangements in relation to a Prohibited Act
49.3.1 If Project Co, Holdco, any Shareholders, any Contracting Associate or anyone
employed by or acting on behalf of any of them commits a Prohibited Act during
the Primary Period or during any period where the Secondary Period (Non
Default) Arrangements apply then the University shall be entitled to act in
accordance with the provisions of Clauses 49.3.1 and 49.3.2 below (as appropriate).
49.3.2 If the Prohibited Act is committed by any employee or agent of Project Co with the
sanction of two or more directors of Project Co or two or more directors of Project
Co had prior knowledge of the Prohibited Act and did not take all reasonable steps
- 151 -
to stop the same happening then the University shall be entitled to terminate the
Primary Period Arrangements immediately upon service of a notice by the
University.
49.3.3 If the Prohibited Act is committed by an employee or agent of Project Co without

the sanction or knowledge of two or more directors of Project Co or the Prohibited
Act is committed by an employee of or agent of any Contracting Associate then the
University shall be entitled to serve a notice on the Project Co terminating the
Primary Period Arrangements within 30 Working Days of service of the notice
unless Project Co terminates or procures the termination of the relevant contract of
employment sub contract or agency.
49.3.4 If the Primary Period Arrangements or the Secondary Period (Non Default)
Arrangements (as applicable) are terminated pursuant to this Clause 49.3 then the
provisions of Clauses 50 (Effects of Termination) and 51 (Consequences of
Termination) shall apply.
Period (Non Default) Arrangements in relation to a Change in Legislation
Where the provisions of paragraph 4.3.2 of Schedule 17 (Change in Legislation) of this

Agreement apply then the University shall be entitled to terminate the Primary Period
Arrangements or the Secondary Period (Non Default) Arrangements (as applicable) on
the service of notice on the Project Co and the provisions of Clauses 50 (Effects of
Termination) and Clause 51 (Consequences of Termination) shall apply.
Period (Non Default) Arrangements following the occurrence of an Uninsurable Risk
Following the occurrence of an Uninsurable Risk where the University has elected so to do
pursuant to Clause 58 (Uninsurable Risks) then the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements (as applicable) shall terminate and the
provisions of Clauses 50 (Effects of Termination) and 51 (Consequences of Termination) shall
apply.
49.6 Default by the University entitling Project Co to terminate the Primary Period
Arrangements
49.6.1 The following shall be "University Default Events" during the Primary Period:
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49.6.2 (a) Upon the occurrence of a University Default Event and so long as such
University Default Event is not waived, Project Co may serve a notice
specifying that a University Default Event has occurred and in the case of
an LU Cross Default such notice may also terminate the Primary Period
Arrangements and the provisions of clause 50 (Effects of Termination) and
clause 51 (Consequences of Termination) shall apply.
- 153 -
(b) Save in respect of Clause 49.6.1(d) if the University Default Event is still
subsisting 20 Working Days after service of the notice referred to in
Clause 49.6.2(a) (but not in respect of any Event of Default under Clause
49.6.1(b) unless the University has failed to comply with a Remediation
Notice) then Project Co may serve a further notice terminating the Primary
Period Arrangements and on service of such notice the Primary Period
Arrangements shall terminate and the provisions of Clauses 50 (Effects of
Termination) and Clause 51 (Consequences of Termination) shall apply.
49.6A Default by the University entitling Project Co to terminate the Secondary Period (Non
Default) Arrangements
49.6A.1
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49.6A2 (a) Upon the occurrence of a University Default Event during any period
where the Secondary Period (Non Default) Arrangements apply and so
long as such University Default Event is not waived, Project Co may
serve a notice specifying that a University Default Event has occurred.
(b) If the University Default Event is still subsisting 20 Working Days

after service of the notice referred to in Clause 49.6A.2(a) (but not in
respect of any Event of Default under Clause 49.6A.2.1(b) unless the
University has failed to comply with a Remediation Notice) then
Project Co may serve a further notice terminating the Secondary
Period (Non Default) Arrangements and on service of such notice the
Secondary Period (Non Default) Arrangements shall terminate and
the provisions of Clauses 50 (Effects of Termination) and Clause 51
(Consequences of Termination) shall apply.
49.7 Entitlement of the Project Co to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements on occurrence of an Uninsurable Risk
Where the provisions of Clause 58 (Uninsurable Risks) apply and Project Co has so elected
then upon service of a notice on the University the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements (as appropriate) shall terminate and the
apply.
49.8 Entitlement of either Party to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements immediately due to an extended period
of Force Majeure
Where the occurrence of an event of Force Majeure has materially prevented or delayed a
Party from performing a substantial proportion of its obligations under the Project Documents
for a period of 180 Working Days or more then either Party may, so long as such
circumstances continue, terminate the Primary Period Arrangements or the Secondary
Period (Non Default) Arrangements in their entirety by notice to the other having
immediate effect whereupon the provisions of Clauses 50 (Effects of Termination) and 51
(Consequences of Termination) shall apply.
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49.9 Events entitling either party to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements on notice
49.9.1 Either Party may terminate the Primary Period Arrangements or (where stated
below) the Secondary Period (Non Default) Arrangements by serving not less
than 3 months notice on the other where any of the circumstances set out in Clause
49.9.2 below apply whereupon the Primary Period Arrangements or (where
stated below) the Secondary Period (Non Default) Arrangements shall terminate
with effect from the end of the Applicable Current Residence Year following
expiry of the notice and the provisions of Clauses 50 (Effects of Termination) and
51 (Consequences of Termination) shall apply.
49.9.2 The events entitling either Party to terminate pursuant to Clause 49.9.1 above are as
follows:
(a) (in the case of both the Primary Period Arrangements and the
Secondary Period (Non Default) Arrangements where the provisions of
paragraph 5.2 of Schedule 17 (Change in Legislation) of this Agreement
apply;
(b) (in the case of the Primary Period Arrangements only) where the
provisions of Clause 44.11 (Assignment) of this Agreement apply; and
(c) (in the case of both the Primary Period Arrangements and the
Secondary Period (Non Default) Arrangements where the provisions of
Clause 80.5.6 (Effect of a VAT Change in Legislation) of this Agreement
apply.
49.10 Income Shortfall entitling the University to terminate the Primary Period Arrangements
The University shall be entitled to terminate the Primary Period Arrangements on the service
of notice on the Project Co if at any time there is in
in the Blocked URA Rental Distribution Account and the
apply.
49.11 Automatic Termination of the Project Documents
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Save to the extent expressly provided to the contrary (and in particular the provisions of the
Senior Lenders Direct Agreement) the Agreement and the Project Documents shall
automatically cease and determine on the earlier of:-
49.11.1 the expiration of 38 years from the Effective Date unless prior to that date a notice
to terminate the Primary Period Arrangements has been served pursuant to the
provisions of Clauses 49.1 to 49.10 (inclusive) above(where the Secondary
Period (Non Default) Arrangements apply) on the Term Expiry Date;
49.11.2 (where the Secondary Period Work-Out Arrangements apply) the later of:
(a) the earlier of the expiration of the Agreed Work-Out Period and the date
upon which all Senior Debt sums have been repaid but not exceeding 48
yearsthe Term Expiry Date; and
(b) the date which is thirty eight years from the EffectiveTerm Expiry Date;
49.11.3 (where the Secondary Period Instalment Arrangements apply) the date upon which
the Senior Debt Sums have been paid;
49.11.4 Not used;
49.11.5 (where the University Triggered Work-Out Arrangements apply as a result of a

termination of the PrimarySecured Loan Period Arrangements pursuant to Clause
49.6 other that clause 49.6.1(ad)) the date upon which the University Termination
Sum has been paid;
49.11.6 (where the University Triggered Work-Out Arrangements apply as a result of a

termination of the PrimarySecured Loan Period Arrangements pursuant to Clause
49.1049.6.1(d)) the later of:
(a) the date upon which Senior Debt Sums have been paid; and
(b) the date which is thirty eight years from the EffectiveTerm Expiry Date;
49.11.7 the date upon which the Relevant Full Enhanced Headleases are granted to the
Project Company or any Nominated Entity but without prejudice to the University's
obligation to pay the Applicable Termination Sum where relevant.
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50. EFFECTS OF TERMINATION OF THE PRIMARY PERIOD ARRANGEMENTS OR
THE SECONDARY PERIOD (NON DEFAULT) ARRANGEMENTS
50.1 Continued Performance
The Parties shall continue to perform their obligations under this Agreement and the Project
Documents notwithstanding the giving of any notice of default or notice of termination, until
the termination of the PrimarySecured Loan Period Arrangements or the Secondary Period
(Non Default) Arrangements becomes final in accordance with the provisions of Clause 49
and where applicable the Senior Lenders' Direct Agreement, whereupon the parties shall
perform their respective obligations including the Secondaryin respect of any termination of
the Secured Loan Period Arrangements the Work-Out Arrangements under the Project
Documents during the SecondaryFollowing Period
50.2 Disputed Termination
50.2.1 Subject to Clause 50.2.2, where either Party has given notice of termination of the
Primary Period Arrangements or the Secondary Period (Non Default)
Arrangements , the other Party may, within ten Working Days of receipt of such
notice, refer the question of the validity of such termination for determination by an
Expert pursuant to the Liaison and Disputes Resolution Procedure. Termination of
the Primary Period Arrangements or the Secondary Period (Non Default)
Arrangements shall not take effect unless and until it is finally determined in
accordance with the Liaison and Disputes Resolution Procedure that such
termination is valid.
50.2.2 Project Co shall not be entitled to rely on Clause 50.2.1 where the University serves
notice to voluntarily terminate the Project Documents (which shall terminate upon
expiry of the period of notice given pursuant to such Clause).
51. CONSEQUENCES OF TERMINATION
51.1.1 If the University terminates the Project Documents pursuant to the provisions of
Clause 49.2 (University's Right to Voluntarily Terminate) or Project Co terminates
the Project Documents pursuant to Clause 49.6.1(d) (LU Cross-Default) then the
provisions of Part A1 of Schedule 20 (Rental payments following a termination of
the Primary Period Arrangements and/or the Secondary Period (Non Default)
Arrangements) shall apply.
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51.1.1A If the University terminates the Project Documents pursuant to the provisions of
Clause 49.10 (Income Shortfall entitling the University to terminate) then the
provisions of Part A of Schedule 20 (Rental Payments following a termination of
the Primary Period Arrangements and/or the Secondary Period (Non Default)
51.1.2 If Project Co terminates the Project Documents pursuant to the provisions of

Clause 49.6 (Default by the University entitling Project Co to terminate the
Primary Period Arrangements) (other than clause 49.6.1(d)) or pursuant to the
provisions of clause 49.6A (Default by the University entitling Project Co to
terminate the Secondary Period (Non Default) Arrangements) then the provisions
of Part A of Schedule 20 (Rental payments following a termination of the Primary
Period Arrangements) shall apply.
51.1.3 If the University terminates the Project Documents pursuant to the provisions of
Clause 49.4 (University's right to terminate the Primary Period Arrangements or
the Secondary Period (Non Default) Arrangements in relation to a change in
legislation) then the provisions of Part C of Schedule 20 (Rental payments
following a termination of the Primary Period Arrangements) shall apply.
51.1.4 If either Party terminates the Project Documents pursuant to Clause 49.8
(Entitlement of either party to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements due to an extended period of
Force Majeure) then the provisions of Part C of Schedule 20 (Rental payments
following a termination of the Primary Period Arrangements and/or the Secondary
Period (Non Default) Arrangements) shall apply.
51.1.5 If either Party terminates the Project Documents pursuant to Clause 49.9 (Events
entitling either party to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements on notice) then the provisions of
Part C of Schedule 20 (Rental Payments following a termination of the Primary
Period Arrangements and/or the Secondary Period (Non Default) Arrangements)
shall apply.
51.1.6 If the University terminates the Project Documents pursuant to Clause 49.3
(University's right to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements in relation to a Prohibited Act)
then the provisions of Part D of Schedule 20 (Rental payments following a
- 159 -
termination of the Primary Period Arrangements and/or the Secondary Period
(Non Default) Arrangements) shall apply.
51.1.7 If the University terminates the Project Documents pursuant to Clause 49.5
(University's abilityright to terminate the Primary Period Arrangements or the
Secondary Period (Non Default) Arrangements following the occurrence of an
Uninsurable Risk) then the provisions of Part C of Schedule 20 (Rental payments
following a termination of the Primary Period Arrangements and/or the
Secondary Period (Non Default) Arrangements) shall apply.
51.1.8 If Project Co determines the Project Documents pursuant to Clause 49.7

(Entitlement of the Project Co's right to terminate followingthe Primary Period
Arrangements or the Secondary Period (Non Default) Arrangements on the
occurrence of an Uninsurable Risk) then the provisions of Part C of Schedule 20
(Rental payments following a termination of the Primary Period Arrangements
and/or the Secondary Period (Non Default) Arrangements) shall apply.
51.1.9 If Project Co determines the Project Documents pursuant to Clause 44.11 (Project
Co's rightability to terminate for an Obligatory Major Disposal or an Obligatory
Mergerand level of compensation) then the provisions of Part C of Schedule 20
(Rental Payments following a termination of the Primary Period Arrangements
and/or the Secondary Period (Non Default) Arrangements) shall apply.
51.2 Where the Primary Period Arrangements have been terminated and the Secondary Period
Work Out Arrangements do not apply or have been terminatedOn the Term Expiry Date
Project Co shall perform its obligations set out in paragraph 9 of Part 1 of Schedule 11.
51A Events of Project Co Default and the University's Right to Terminate the Secondary
Period (Non Default) Arrangements
51A.1 Notification of Events of Default
Project Co undertakes that it shall notify the University of the occurrence of

any Event of Project Co Default which occurs during the period where the
Secondary Period (Non Default) Arrangements apply promptly upon Project
Co becoming aware of the occurrence thereof. Any such notification shall
include reasonable details of the circumstances giving rise to the delivery of
the notice.
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51A.2 Actions following an Event of Project Co Default
(a) If an Event of Project Co Default has occurred then, if the Event of

Project Co Default is a Remediable Default, the University shall serve
on Project Co a Remediation Notice.
(b) If an Event of Project Co Default has occurred which is not a

Remediable Default, or in relation to a Remediable Default Project Co
has not complied with the Remediation Notice, then (subject to Project
Co's right to dispute Termination under Clause 50.2 and to the
provisions of the Senior Lenders' Direct Agreement) the University
shall be entitled to serve a notice (a "Final Termination Notice") on
Project Co and the provisions of Clause 51B below shall apply.
51B Effect of Termination of the Secondary Period (Non Default) Arrangements

for an Event of Project Co Default
Where the provisions of Clause 51A above apply then the provisions of Part
G of Schedule 20 (Termination of the Secondary Period (Non Default
Arrangements Payment following a Termination for an Event of Project Co
Default) shall apply.
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Part 10 – Phase 4 WorksNot Used
52. PHASE 4 WORKS ARRANGEMENTSNOT USED
52.1 University's right to elect for Project Co to seek funding in respect of the Phase 4 Works
The University shall be entitled to elect for Project Co to seek finance for the carrying out of
the Phase 4 Works from its existing funders by giving Project Co a written notice (a "Phase 4
Election Notice") served on Project Co no later than 31 July 2006 or (if deferral of the Phase 4
Test Date occurs pursuant to Clause 52.8) 31 July 2007.
52.2 Project Co obligations to seek funding
52.2.1 Following service of a Phase 4 Election Notice Project Co shall use all reasonable
endeavours to obtain finance from its existing funders for the carrying out of the
Phase 4 Works but shall not enter into any binding commitment without first
obtaining the prior written approval of the University (which shall not be
unreasonably withheld or delayed).
52.2.2 Project Co shall be under no obligation to carry out the Phase 4 Works unless it has
satisfied the Phase 4 Financing Conditions Precedent and it has been agreed or
determined that the Phase 4 Works Condition Precedent have been satisfied.
52.2.3 If having used its reasonable endeavours to obtain a legally binding commitment to
obtain finance for the carrying out of the Works from its existing funders (on terms
acceptable to the University acting reasonably) Project Co has been unable to do so
prior to the Phase 4 Works Cut Off Date then the provisions of Clause 52.6 shall
apply.
52.2.4 Where Project Co has been able to obtain the necessary finance for the Phase 4
Works from its existing funders on terms acceptable to the University (acting
reasonably) and has satisfied the Phase 4 Financing Conditions Precedent prior to
the Phase 4 Works Cut Off Date and it has been agreed or determined that the
Phase 4 Works Conditions Precedent have been satisfied then the provisions of
Clause 52.7 below shall apply.
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52.3 Applications Report and Supporting Analysis
Following service of a Phase 4 Election Notice and not later than 30 September 2006 or (if a
deferral of the Phase 4 Test Date occurs pursuant to Clause 52.8) 30 September 2007, the
University shall provide Project Co with a report (the "Applications Report and Supporting
Analysis") in the Agreed Form (as such report may be amended by agreement between the
parties from time to time). The Applications Report and Supporting Analysis shall contain the
following information:
(a) the number of Attending Students forecast over the Phase 4 Test Forecast Period;
52.1 the number of Rooms which are the subject of Student Residence Agreements for
Residence Year 2005 and 2006 (the figures for such Residence Year to give a
breakdown for Student Residence Agreements between Project Co Accommodation,
the Existing Accommodation and the University Residential Accommodation and to
show numbers for students in such accommodation in each year of their course of
study); and
52.1 Historic Rental Income (Phase 4) for Residence Year 2005 and the Relevant
Aggregate Net Rental Income Amount forecast for Residence Year 2006.
52.2 Phase 4 Counter Notice
52.2.1 Following receipt of any Phase 4 Election Notice Project Co shall be entitled at any
time prior to the Phase 4 Works Cut Off Date to serve a counter notice (a "Phase 4
Counter Notice") on the University
52.2.2 If Project Co either:
(a) confirms in the Phase 4 Counter Notice its acceptance that the Phase 4
Works Conditions Precedent have been met; or
(b) does not dispute the Phase 4 Election Notice within a period of 20 Working
Days from the date of the Phase 4 Election Notice
then the Phase 4 Works Conditions Precedent shall be deemed to have been met.
52.2.3 If in the Phase 4 Counter Notice Project Co disputes that the Phase 4 Works
Condition Precedent have been met then the parties shall refer the matter for
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determination by an Expert pursuant to the provisions of the Liaison and Disputes
Resolution Procedure.
52.3 Project Co Information and Audit rights
The University shall provide to Project Co all information, documents, records and the like in
the possession of, or available to, the University as may be reasonably requested by Project Co
for any purpose in connection with the validation of information supplied by the University
under this Clause 52.
52.4 Consequential provisions where Project Co does not proceed with the Phase 4 Works
Where it is agreed or determined that the Phase 4 Works Condition Precedent have not been
satisfied, or the Project Co has been unable to satisfy the Phase 4 Financing Conditions
Precedent prior to the Phase 4 Works Cut Off Date, or the University has elected or is deemed
to have elected not to proceed with the Phase 4 Works then Project Co shall not be under any
obligation to carry out any of the Phase 4 Works save that the provisions of Clause 52.9 shall
apply in relation to the demolition of Grizedale.
52.5 Consequential provisions where the Phase 4 Works Condition Precedent and Phase 4
Financing Conditions Precedent have been satisfied
52.5.1 Where the Phase 4 Works Condition Precedent and Phase 4 Financing Conditions
Precedent have been satisfied then subject to the provisions of Clause 52.10:
(a) the Parties shall agree the Operating Financial Model which shall include
the Phase 4 Works and which shall be in the form of the Base Case Phase 4
Financial Model as adjusted to reflect the terms of the financing for which
the Project Co has secured a legally binding commitment pursuant to clause
52.2.3. Any dispute as to the Operating Financial Model shall be
determined by an Expert in accordance with the provisions of the Liaison
and Disputes Resolution Procedure;
(b) the University shall notify Project Co whether it wishes to include in the
Phase 4 Works the refurbishment of the Grizedale 20 Rooms and if the
University does not wish to include such refurbishment in the Phase 4
Works then the Base Case Phase 4 Financial Model shall be adjusted
accordingly to remove the cost as shown at cell 23659 of the Base Case
Phase 4 Financial Model.
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(c) the provisions of this Agreement shall apply to the Phase 4 Works together
with any adjustments to this Agreement and/or the Project Documents as
the Parties shall agree acting reasonably. Any Dispute as to the
adjustments to be made to this Agreement or any other Project Document
shall be determined by an Expert pursuant to the provisions of the Liaison
and Disputes Resolution Procedure.
52.6 Deferral of the Phase 4 Test Date
In the event that the Phase 3 Works Completion Date did not occur such that Phase 3 was not
offered to Students for occupation for the whole of Residence Year 2005 then the University
shall be entitled to defer the Phase 4 Works Cut Off Date until 30 November 2007 by
reference to the arrangements for Residence Year 2007 and the provisions of Clauses 52.1 to
52.7 (inclusive) shall apply (mutatis mutandis) with all Residence Years and time periods for
the purposes of the Phase 4 Tests being adjusted by 12 months.
52.7 Arrangements relating to County & Grizedale
52.7.1 Project Co shall as part of the Phase 3 Works commence the demolition of
Grizedale at the end of July 2006 (the "Demolition Date") provided that the
University shall be entitled to require Project Co not to proceed with the demolition
of Grizedale on not less than one weeks' notice served prior to the Demolition Date.
52.7.2 Subject to Clause 52.9.3, where Project Co does not proceed with the Phase 4
Works and following the relevant Grizedale and County Leases Termination Date,
County and Grizedale (where not demolished pursuant to Clause 52.9.1) shall form
part of the University Residential Accommodation.
52.7.3 The provisions of Clauses 63 (Reinstatement of University Residential

Accommodation) and 66 (University Residential Accommodation) shall not apply
to either County or Grizedale.
52.9.4 For the avoidance of doubt, no account shall be taken of the state of progress of the
works necessary to demolish Grizedale in determining whether or not the Works
Completion Conditions have been satisfied in relation to Phase 3.
52.9.5 Where the University has not instructed Project Co not to demolish Grizedale
under Clause 52.9.1, then:
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(a) Project Co shall give to the University and the Employer's Agent not less
than ten (10) Working Days' notice of the date upon which Project Co
considers that the demolition of Grizedale (and the clearance of the
corresponding part of the Site) will be completed;
(b) When Project Co is of the opinion that the demolition of Grizedale (and the
clearance of the corresponding part of the Site) has been completed, it shall
forthwith notify the Employer's Agent and the University of the same; and
(c) If the Employer's Agent is satisfied that the demolition has been properly
carried out he shall, within two (2) Working Days of his receipt of Project
Co's notice given under Clause 52.9.5(b), issue a certificate to the Parties
stating the date upon which the demolition of Grizedale has been
completed.
52.8 No obligations upon the University
Notwithstanding the service of a Phase 4 Election Notice or the satisfaction of the Phase 4
Works Condition Precedent and the Phase 4 Financing Conditions Precedent the University
shall be under no obligation to proceed with the Project in respect of Phase 4 unless the
Council of the University so elects to do so and the University has obtained all requisite
external consents required to allow it to do so.
52.9 Project Co's position
The University agrees that a failure by Project Co to comply with its obligations pursuant to
this Clause 52 shall not constitute a breach of its obligations nor (for the avoidance of doubt)
an Event of Project Co Default.
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Part 11 - Insurance
53. INSURANCE OBLIGATIONS IN RELATION TO THE ACCOMMODATION
53.1 During the carrying out of the Works Project Co shall take out and maintain or procure the
taking out and maintenance of the insurances described in Part 1 of Schedule 18 (Insurances)
for the periods set out therein and any other insurances as may be required by Legislation
provided that the insurance cover requires to be effective in each case not later than the date
on which it is required or specified in Part 1 of Schedule 18 (Insurances) or determined by
Legislation.
53.2 During the Operational Phase Project Co shall take out and maintain or procure the taking out
and maintenance of the insurances described in Part 2 of Schedule 18 (Insurances) and any
other insurances as may be required by Legislation provided that the insurance cover requires
to be effective in each case not later than the date on which it is required as specified in
Schedule 18 (Insurances) or determined by Legislation, provided that for the avoidance of
doubt there shall be no obligation to obtain insurance to the extent that the relevant risk is
Uninsurable
53.3 Neither Project Co nor the University shall do and/or fail to do any act or thing or, insofar as it
is reasonably within its power, permit anything to occur which would entitle any insurer to
refuse to pay any claim under any insurance policy and/or which would make any insurance
policy void or voidable or entitle the relevant insurer to treat such policy as vitiated.
53.4 The insurances referred to in Clauses 53.1 and 53.2 shall:
53.4.1 name the University as co-insured with any other party maintaining the insurance
where Schedule 18 (Insurances) states that the University should be a co-insured;
53.4.2 where the University is not co-insured contain a Clause waiving the insurers'
subrogation rights against the University and any University Party;
53.4.3 provide for 30 Working Days prior written notice of their cancellation non-renewal
or amendment to be given to the University;
53.4.4 provide for payment of any proceeds to be made by insurers in accordance with
Clause 55 (Insurance Proceeds);
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53.4.5 be on terms that provide that a failure by Project Co to pay the relevant premiums
or a breach by Project Co of a material warranty contained in any such policy will
not invalidate the cover provided to the University under the policy.
53.5 Project Co shall provide to the University:
53.5.1 copies, whenever reasonably requested, of all insurance policies relating to the
above and the University shall be entitled to inspect them during ordinary business
hours and;
53.5.2 evidence that the premiums payable under all insurance policies have been paid and
that the insurances are in full force and effect.
53.6 Renewal certificates in relation to insurances referred to in Clauses 53.1 and 53.2 shall be
obtained as and when necessary and when available copies (certified in a manner acceptable to
the University) shall be forwarded to the University as soon as possible, but in any event at
least 10 Working Days before the relevant renewal date.
53.7 If Project Co is in breach of Clauses 53.1 and 53.2 above, the University may pay any
premiums required to keep such insurance in force or itself procure such insurance and may in
either case recover such amounts from Project Co on written demand.
53.8 Project Co shall give the University notification as soon as reasonably practicable and in any
event within 20 Working Days after any claim of more than £50,000 on any of the insurance
policies referred to in this Clause accompanied by a copy of such claim.
53.9 Neither failure to comply nor full compliance with the insurance provisions of this Agreement
nor the terms of any insurance policy shall limit or relieve Project Co of its liabilities and
obligations under this Agreement or any of the Project Documents.
54. INSURANCE ACCOUNT
The parties shall acting reasonably as soon as practicable establish the Insurance Account.
55. INSURANCE PROCEEDS
55.1 All proceeds of any insurance policy effected pursuant to the terms of this Agreement shall:
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55.1.1 in the case of third party insurance, legal liability insurance or employer's liability
insurance be applied by Project Co or the insurer in satisfaction of the claim
demand proceeding or liability in respect of which such proceeds are payable or
shall be paid by the insurer direct to the claimant as the case may be;
55.1.2 in respect of insurance proceeds received under any policy referred to in paragraph
1 of Part 1 (Construction "All Risks" Insurance) and paragraph 1 (Property "All
Risks") of part 2 of Schedule 18 (Insurances) other than in respect of advanced loss
of profit or business interruption:
(a) if the proceeds in respect of a single event (or a series of related events) are
in an amount in excess of £1 million (RPI Indexed) then such proceeds
shall, subject to Clause 56 below, be paid to the Insurance Account or
(b) in any other case be paid directly to Project Co and
in both cases, shall subject to Clause 56 (Economic Reinstatement Test) of this

Agreement be applied to repair reinstate and replace each part or parts of the
Premises in respect of which the proceeds were received so as to ensure the
performance by Project Co of its obligations under the Project Documents.
55.1.3 in the case of any other insurance be paid to Project Co and applied by Project Co
so as to ensure the performance by Project Co of its obligations under the Project
Documents.
55.2 The proceeds paid into the Insurance Account pursuant to Clause 55.1.2(a) (the "Relevant
Proceeds") (together with any interest accrued) may subject to Clause 56 (Economic
Reinstatement Test) be used by Project Co as required to enable it to make payments in
accordance with the terms of the contractual arrangements referred to in Clause 57 (Economic
Reinstatement) of this Agreement below.
55.3 The University and Project Co shall take whatever administrative action is required to make
payments from the Insurance Account in accordance with this Clause 55.
56. ECONOMIC REINSTATEMENT TEST
56.1 If during the Secured Loan Period any Building or a substantial part of a building is
destroyed or substantially destroyed in an event or series of events (whether or not with the
remainder of the Accommodation) and the Insurance Proceeds (when taken together with any
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funds available to Project Co for the purposes of reinstatement) are equal to or greater than the
amount required to reinstate the Building or relevant part of the Building then the provisions
of Clause 56.2 below shall apply.
56.2 In the circumstances set out in Clause 56.1 Project Co shall prepare a Forecast of the sums
referred to in A of the definition of Economic Reinstatement Test Ratio for the remaining
years of the Primary Period on the assumption that the Building or the relevant part of the
Building which has been damaged or destroyed are reinstated in accordance with Clause
55.1.2 taking into account any insurance proceeds payable to the Project Co in respect of loss
of rent or business interruption.
56.3 If following agreement or determination of the Forecast referred to in 56.2 above the Forecast
is such that the Economic Reinstatement Test Ratio is less than 1.20:1 then Project Co shall be
relieved of its obligation to reinstate the Building or the relevant part thereof and where
permitted by the relevant insurers under the terms of the relevant policy then the relevant
Insurance Proceeds shall be applied in accordance with Clause 56.4 below.
56.4 Where the provisions of Clause 56.3 above apply then an amount equal to the lesser of:
56.4.1 the amount of the Insurance Proceeds that the insurer is willing to be paid out as a
lump sum rather than towards reinstatement of the Building or relevant part; and
56.4.2 the proportion of the Outstanding Senior Debt attributable to the Building
shall be released to Project Co as soon as reasonably practicable from the Insurance Account
and paid to the Senior Lenders.
56.5 Where notwithstanding the provisions of Clause 56.4 above the relevant insurer is not required
to pay Insurance Proceeds other than in respect of reinstatement of the Building and will not
agree to pay the insurance proceeds in the manner set out in Clause 56.4 above then such
proceeds shall be applied by the Project Co in reinstatement of the Building pursuant to its
obligations in Clause 57 (Reinstatement).
56.6 In the circumstances set out in Clause 56.3 above and where the provisions of Clause 56.5 do
not apply then, the Project shall automatically cease and determine in relation to the Building
and the relevant Long Term Lease and Long Term Underlease or Short Term Lease and Short
Term Underlease as appropriate shall be surrendered as to whole or part as appropriate on the
date ten (10) Working Days after the date upon which Project Co has received the sums
referred to in Clause 56.4 above by the University surrendering all its rights title and interest
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in the relevant Long Term Underlease or Short Term Underlease (as appropriate) to Project
Co to the extent that the relevant Long Term Underlease or Short Term Underlease (as
appropriate) or part thereof shall immediately merge and be extinguished in the reversion
immediately expectant upon its determination and Project Co surrendering all its rights title
and interest in the Long Term Lease or Short Term Lease (as appropriate) to the University to
the intent that the relevant Long Term Lease or Short Term Lease (as appropriate) shall
immediately merge and be extinguished on the reversion immediately expectant upon its
determination, and the University shall owe no obligations to Project Co to make any further
payments by way of compensation but otherwise without prejudice to any rights which either
party may have against the other for antecedent breaches.
56.7 Following agreement or determination of the Forecast referred to in Clause 56.2 above if the
Forecast for the remainder of the Term means that the Economic Reinstatement Test Ratio is
more than 1.20:1 then the Project Co shall be obliged to comply with its obligations in relation
to reinstatement contained in Clause 57 (Reinstatement).
56.8 Where the provisions of Clauses 56.3 to 56.6 (inclusive) above apply then the parties shall as
soon as reasonably practicable make the necessary adjustments to the Operating Financial
Model to reflect the circumstances set out in Clauses 56.3 to 56.6 above and shall agree the
adjustments inter alia to the Base Case Requirements, Relevant Required Rent and Modelled
Rental Income, and Modelled Ground Rent which will ensure that the parties' respective
commercial positions are no better and no worse. Any disputes as to the necessary
adjustments to be made to the Operating Financial Model shall be referred for determination
by an Expert pursuant to the Liaison and Dispute Resolution Procedure.
57. REINSTATEMENT
57.1 Save where the provisions of Clause 56.3 (Economic Reinstatement Test) apply Project Co
shall apply all insurance proceeds in reinstatement of the damage and where damage is in
excess of £1 million (RPI indexed):
57.1.1 Project Co shall deliver to the University as soon as practicable a plan (the
"Reinstatement Plan") for the carrying out of the works necessary (the
"Reinstatement Works") to repair reinstate or replace the part or parts of the
Project Co Accommodation or any part of the Project Co Accommodation that
have been damaged. The Reinstatement Plan shall set out:
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(a) the identity of the person proposed to effect the Reinstatement Works
which shall be subject to the prior written approval of the University (such
approval not to be unreasonably withheld or delayed); and
(b) the proposed terms and timetable upon which the Reinstatement Works are
to be effected (including the date that the Project Co Accommodation or
relevant part of the Project Co Accommodation will no longer be subject to
any Unavailability and that the Services will be provided in full) such terms
to be agreed by the parties acting reasonably;
57.1.2 Provided that the University is satisfied (acting reasonably) that the Reinstatement
Plan will enable Project Co to comply with Clause 57.2 below:
(a) the Reinstatement Plan will be adopted;
(b) Project Co shall enter into contractual arrangements to effect the

Reinstatement Works with the person(s) identified in the approved
Reinstatement Plan approved by the University (acting reasonably);
(c) the University undertakes to use all reasonable endeavours to assist Project
Co in the carrying out of the Reinstatement Plan.
57.2 Project Co shall procure that all Reinstatement Works and any other works required to be
carried out are carried out:
57.2.1 in a good and workmanlike manner and in accordance with good building practice;
57.2.2 with good and suitable materials;
57.2.3 in accordance with any Necessary Consents;
57.2.4 in compliance with Legislation;
57.2.5 with due diligence and in any event so that such works are completed as soon as
reasonably practicable,
and in accordance with the relevant provisions of Clauses 28 to 40 (inclusive) (but excluding
the provisions of Clause 35) of this Agreement to the extent they are applicable and not
expressly dealt with above and in construing the provisions relating to Works references to the
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Works shall be read as references to works under this Clause 57 and references to the Building
Contractor shall be to the contractor approved pursuant to Clause 57.1.
58. UNINSURABLE RISKS
58.1 If any of the risks required to be insured against in Part 2 of Schedule 18 (Insurances)
becomes Uninsurable during the Operational Phase then
58.1.1 Project Co shall notify the University within five Working Days of the risk
becoming Uninsurable; and
58.1.2 if it is agreed or determined that such risk is Uninsurable and that this has not been
caused by Project Co or any Contracting Associate then the parties shall meet to
discuss the means by which the risk should be managed.
58.2 Where the parties have not been able to agree as to how to manage the risk, the University
shall be entitled to be paid by Project Co an amount equal to the insurance premium which
had previously been paid by Project Co in respect of the Uninsurable Risk immediately prior
to the risk becoming Uninsurable such amount to be payable at the same time and in
accordance with the same priority of payment as if it remained Project Co Insurance Premia
and on the occurrence of the risk at the University's option either:
58.2.1 pay to Project Co an amount equal to the Insurance Proceeds that would have been
payable had the relevant insurance continued to be available whereupon this
Agreement shall continue including the obligation on Project Co to reinstate
pursuant to Clause 57; or
58.2.2 terminate the Project Documents pursuant to Clause 49.5 (University's right to
terminate following the occurrence of an Uninsurable Risk).
58.3 If following the occurrence of an Uninsurable Risk the University has not made an election
pursuant to Clause 58.2 within twenty working days of the Uninsurable Risk occurring then
Project Co shall be entitled to terminate the Project Documents pursuant to Clause 49.7
(Entitlement of Project Co to terminate following the occurrence of an Uninsurable Risk).
59. NOT USED
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60. UNIVERSITY'S INSURANCE OBLIGATIONS IN RELATION TO THE
UNIVERSITY RESIDENTIAL ACCOMMODATION
60.1A The provisions of this clause 60 shall only apply during the Primary Period or where the
Work-out Arrangements or the University Triggered Work-Out Arrangements apply
and where the Secondary Period (Non Default) Arrangements apply the University shall
not be required to take out or maintain any insurances in respect of the University
Residential Accommodation and the provisions of this clause 60 shall not apply
60.1 The University shall maintain and procure the maintenance of the insurances described in Part
3 of Schedule 18 (Insurances) to this Agreement in relation to those buildings which comprise
the University Residential Accommodation for the period from the Effective Date until the
earlier of the expiry of the Primary Period or (where the Work-Out Arrangements or the
University Triggered Work-Out Arrangements apply) the Term Expiry Date, or the
Termination Date or, in relation to any Rooms in the University Residential Accommodation
which the University is entitled to cease to use or make available to Students pursuant to
Clause 66.5 (University Residential Accommodation) the date upon which the provisions of
Clause 66.5 (University Residential Accommodation) apply, save where the relevant buildings
in which Rooms are situate also contains Rooms which the University is not entitled to so
cease to use), provided that for the avoidance of doubt there shall be no obligation to obtain
insurance to the extent that the relevant risk is Uninsurable.
60.2 Neither the University nor Project Co shall do or fail to do any act or thing or insofar as it is
reasonably within its power permit anything to occur which would entitle any insurer in
relation to the insurances which the University is required to maintain pursuant to Clause 60.1
to refuse to pay any claim under any insurance policy and/or which would make any insurance
policy void or voidable or entitle the relevant insurer to treat such policy as vitiated.
60.3 The University shall provide to Project Co:
60.3.1 copies whenever reasonably requested of all insurance policies relating to the
insurances which the University is required to maintain pursuant to Clause 60.1 and
Project Co shall be entitled to inspect them during ordinary business hours; and
60.3.2 evidence that the premiums payable under all insurance policies for the insurances
which the University is required to maintain pursuant to Clause 60.1 have been
paid and that the insurances are in full force and effect.
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60.4 The University shall provide renewal certificates in relation to the insurances which it is
required to maintain pursuant to Clause 60.1 as and when necessary and when available copies
(certified in a manner acceptable to Project Co) shall be forwarded to Project Co as soon as
possible but in any event at least 10 Working Days before the relevant renewal date.
61. APPLICATION OF INSURANCE PROCEEDS IN RELATION TO THE

UNIVERSITY RESIDENTIAL ACCOMMODATION
61.1 All proceeds of any insurance policy effected by the University pursuant to Clause 60.1 but
not for the avoidance of doubt the proceeds of any insurance policy effected by the
University in respect of the University Residential Accommodation where such insurance
is not effected by the University pursuant to its obligation to Project Co under Clause 60
of this Agreement or is effected after the expiry of the Primary Period (save where the
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply)
shall:
61.1.1 in the case of third party insurances, legal liability insurance or employer's liability
insurance be applied by the University or the insurer in satisfaction of the claim
demand proceeding or liability in respect of which such proceeds are payable or
shall be paid by the insurer direct to the claimant as the case may be;
61.1.2 in respect of insurance proceeds received in respect of damage to the University

Residential Accommodation subject to Clause 62 of this Agreement (University
Residential Accommodation Reinstatement Test) be applied to repair reinstate and
replace the University Residential Accommodation in accordance with the
provisions of Clause 63 (Reinstatement of University Residential Accommodation).
62. UNIVERSITY RESIDENTIAL ACCOMMODATION REINSTATEMENT TEST
62.1 This Clause 62 does not apply to the Core Accommodation and shall not apply after the
expiry of the Primary Period (save where the Work-Out Arrangements or the University
Triggered Work-Out Arrangements apply).
62.2 If any building or a substantial part of a building forming part of the University Residential
Accommodation is damaged or destroyed or substantially in an event or series of events
(whether or not with the remainder of the University Resident Accommodation) (other than
those buildings referred to in Clause 62.1 above) then the University shall not be obliged to
comply with its obligation in Clause 63 (Reinstatement of University Residential
Accommodation) where at the date of such damage or destruction the University would have
- 175 -
been entitled to cease to use or make available such building to Students pursuant to Clause
66.5 (University Residential Accommodation).
63. REINSTATEMENT OF UNIVERSITY RESIDENTIAL ACCOMMODATION
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply.
63.1 Save where the provisions of Clause 62.2 (University Residential Accommodation
Reinstatement Test) of this Agreement apply the University shall apply all insurance proceeds
in reinstatement of the damage and where damage is in excess of £1 million (RPI indexed) the
University shall deliver to the Project Co as soon as practicable a plan (the "University
Plan") for the carrying out of the works necessary (the "University Reinstatement Works")
to repair reinstate or replace the part or parts of the University Residential Accommodation or
any part of the University Residential Accommodation that have been damaged. The
University Plan shall set out the proposed terms and timetable upon which the Reinstatement
Works are to be effected including the date that the relevant part of the University Residential
Accommodation will be available for letting to Students.
63.2 The University shall procure that all University Reinstatement Works and any other works
required to be carried out to the University Residential Accommodation are carried out:
63.2.1 in a good and workmanlike manner and in accordance with good building practice;
63.2.2 with good and suitable materials;
63.2.3 in accordance with any Necessary Consents;
63.2.4 in compliance with Legislation;
63.2.5 with due diligence and in any event so that such works are completed as soon as
reasonably practicable.
64. APPLICATION OF BUSINESS INTERRUPTION PROCEEDS
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply.
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64.1 If any building forming part of the University Residential Accommodation is damaged or
destroyed then to the extent that the University receives insurance proceeds pursuant to its
business interruption insurance attributable to the damage or destruction of such buildings and
such proceeds exceed the University's costs reasonably and properly incurred in relation to
such buildings (including the costs of provision of alternative accommodation to students)
then such sums together with the rents or licence fees payable to the University by any Student
to whom alternative accommodation has been provided in respect of such buildings shall be
taken into account in the calculation of the URA Net Rental Income for the purpose of
calculating the University Accommodation Charge pursuant to Schedule 13 (the University
Accommodation System Charge and Performance Measurement).
65. UNINSURABLE RISKS IN RELATION TO THE UNIVERSITY RESIDENTIAL

ACCOMMODATION
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply
and for the avoidance of doubt where the Secondary Period (Non Default)
Arrangements apply the University shall not be required to comply with any of the
following provisions of this clause 65.
65.1 If any building or buildings comprising part of the University Residential Accommodation are
damaged or destroyed by a risk which, at the date of such damage or destruction, was
Uninsurable, then the University shall not be under any obligation to repair or reinstate such
damage or destruction.
65.2 If such building or buildings referred to in Clause 65.1 constituted part of the Core
Accommodation (the "Damaged Core Accommodation Building"), then, to the extent that
the University is able to do so it shall provide to Project Co a building or buildings (the
"Substitute Building") for which the URA Net Rental Income from such building or
buildings is expected to be materially the same as that from the Damaged Core
Accommodation Building. The Substitute Building shall with immediate effect be subject to
the same provisions in this Agreement as apply to the Core Accommodation and where such
damage or destruction occurs before the expiry of the Longstop Date the University shall grant
and the Project Co shall accept and Project Co shall grant and the University shall accept a
headlease and underlease respectively of the Substitute Building such headlease and
underlease to be in the same form mutatis mutandis as the Core Accommodation Headlease
and Core Accommodation Underlease and the provisions of clause 6 and 9 of this agreement
shall apply to such grant mutatis mutandis, but with the completion date being the later of the
date five Working Days after agreement or determination of the Substitute Building and the
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date upon which a court of competent jurisdiction authorises an agreement excluding the
provisions of sections 24 to 28 of the Landlord and Tenant Act 1954 to both the headlease and
the underlease.
65.3 Subject to Clause 65.4 below where following the damage or destruction of any building or
buildings comprising part of the University Residential Accommodation by a risk which at the
date of such damage or destruction was Uninsurable, the University does not repair or
reinstate such damage or destruction and the Primary Period Arrangements are subsequently
terminated by the University pursuant to Clause 49.1 for an Event of Project Co Default and
Project Co can demonstrate that had such building or buildings been repaired or reinstated
then the Primary Period Arrangements would not have been so terminated then the provisions
of Part C of Schedule 20 (Rental payments following a termination of the Primary Period
65.4 The provisions of Clause 65.3 shall not apply if at the date of such damage or destruction of
the relevant building or buildings the University would have been entitled to cease to use or
make available such building to Students as a result of establishing the Specified Criteria in
accordance with Clause 66 (University Residential Accommodation).
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Part 12 - The University Residential Accommodation
66. UNIVERSITY RESIDENTIAL ACCOMMODATION
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply
and for the avoidance of doubt where the Secondary Period (Non Default)
Arrangements apply the University shall be under no obligation to maintain the
University Residential Accommodation or to use the same for student residences and
shall be free to demolish, decommission or change the use of all or any part of the
University Residential Accommodation without the consent of Project Co.
66.1 Maintenance of the University Residential Accommodation
The University covenants with Project Co that during the Term the University Residential
Accommodation shall be maintained in accordance with the Applicable Maintenance Regime
provided that:
66.1.1 The University shall not be obliged to maintain any part of the Non-Core
Accommodation in accordance with the Non-Core Accommodation Maintenance
Regime where it has demonstrated to the reasonable satisfaction of Project Co that
the Non-Core Accommodation or relevant part thereof require works of
replacement or renewal such that the relevant part of the Non-Core
Accommodation has reached the end of its economic life.
66.1.2 Project Co shall be entitled, at its own cost but not more than once in any
Residence Year during the Primary Period or where the Work-Out
Arrangements or the University Triggered Work-Out Arrangements apply to
carry out a visual inspection of the Core Accommodation in order to assess and
report on whether it has been maintained in accordance with the Core
Accommodation Maintenance Regime. Project Co shall supply a copy of such
report to the University as soon as reasonably practicable.
66.1.3 The University may following receipt of the report referred to in paragraph 66.1.2
elect that Project Co jointly with the University shall appoint a second firm of
independent reputable building surveyors to carry out a further visual inspection of
the Core Accommodation in order to assess and report on whether it has been
maintained in accordance with the Core Accommodation Maintenance Regime. If
such second report demonstrates that the report prepared pursuant to paragraph
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66.1.2 has not been prepared with appropriate professional skill and care or
thoroughness, Project Co shall meet the costs of the second report. If such second
report does not demonstrate that the report prepared pursuant to paragraph 66.1.2
has been prepared without the appropriate professional skill and care or
thoroughness, the cost of the second report shall be borne by the University.
66.1.4 Project Co and the University shall jointly, at Project Co's cost in every fifth year
of the Termduring the Primary Period or where the Work-Out Arrangements
or the University Triggered Work-Out Arrangements apply commission a
survey of the Core Accommodation.
66.1.5 If the report referred to in Clauses 66.1.2 or 66.1.4 (or if a report is obtained under
Clause 66.1.3) indicates that in any material respects the Core Accommodation is
not in a condition consistent with it having been maintained in accordance with the
Core Accommodation Maintenance Regime, then the University shall specify a
reasonable period, being a minimum of six months, within which the University is
to carry out any steps as are reasonably necessary to bring the Core
Accommodation up to the required standard and the University shall carry out such
steps as are necessary to bring the Core Accommodation up to such standard.
66.1.6 If and to the extent that the University fails to carry out the recommendation to the
Project Co's reasonable satisfaction within the specified period Project Co shall be
entitled to carry out itself or procure such rectification or maintenance work as is
necessary and shall be entitled to be reimbursed by the University the reasonable
and proper costs of such rectification and/or maintenance work.
66.2 Use of the University Residential Accommodation
The University covenants with Project Co that during the TermPrimary Period or where the
Work-Out Arrangements or the University Triggered Work-Out Arrangements apply the
University Residential Accommodation shall continue to be used solely for the purpose of
providing student residences to Students and for Vacation Use and other proper ancillary uses
such as University visitors, University staff, guests or other residential occupiers and, in the
case of Graduate College solely for the purpose of providing student residences to students
PROVIDED THAT:-
66.2.1 during the period commencing on the Effective Date and expiring on 30 September
2008 the University shall be entitled to take out of use for part or all of that period
and for the remainder of the Term up to 300 Rooms in aggregate from the Non-
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Core Accommodation and/or to change the use of such aggregate number of
Rooms;
66.2.2 on and from the commencement of the Residence Year 2008/2009 the University
shall be entitled to take out of use or to change the use of any Rooms forming part
of the Non-Core Accommodation subject to meeting all of the Specified Criteria
66.3 Specified Criteria
66.3.1 The Specified Criteria which must be satisfied (to be specified as part of the detail
submitted in a Room Reduction Notice) are as follows:-
(a) prior to any Room Reduction being effected the Debt Ratios in the then
current Operating Financial Model are not less than the Specified Base
Case Ratios;
(b) following any Proposed Room Reduction the Total Annual Debt Service
Cover Ratio is a minimum of 1.45 and the Average Total Annual Debt
Service Cover Ratio is a minimum of 1.55;
(c) there are no Events of Default or Potential Events of Default under the
Financing Agreements which (in either case) are continuing.
66.3.2 The provisions of the Secured Term Facilities Agreement shall govern the
ascertainment of the Total Annual Debt Service Cover Ratio and the Average Total
Annual Debt Service Cover Ratio assuming the implementation of a Proposed
Room Reduction and the methodology employed and supporting information shall
be set out by the University in any Room Reduction Notice.
66.4 Room Reduction Notice
In the event that the University wishes to effect a Proposed Reduction during the Primary
Period or where the Work-Out Arrangements or the University Triggered Work-Out
Arrangements apply it shall deliver a Room Reduction Notice to each of (1) Project Co (2)
the Security Trustee and (3) the Facility Agent by no later than RR - 30 and such Room
Reduction Notice shall contain appropriate supporting evidence and data to support the request
and the University's contentions that it has satisfied the Specified Criteria.
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66.5 Project Co Response
Within 10 Working Days of receipt of the Room Reduction Notice Project Co shall:-
(a) refer any dispute it has (or of which it has been notified by the Security Trustee or the
Facility Agent) with the content of the Room Reduction Notice for determination by
an Expert pursuant to the provisions of the Liaison and Disputes Resolution
Procedure; or
(b) agree in writing (or take no action to dispute) the contents of the Room Reduction
Notice in which case, provided that the Specified Criteria continue to be satisfied, the
University shall be entitled to effect the Proposed Reduction at any time during the
following 3 months.
67. RESTRICTIVE COVENANT
67.1
67.2 Prohibition on entering into Relevant Residential Agreements
Save as provided in Clause 67.3, the University covenants with Project Co that it will not enter
into any Relevant Residential Agreements prior to the Restricted Period Expiry Date without
Project Co's prior written consent (which Project Co shall be entitled to withhold at its entire
discretion).
67.3 Permitted Relevant Residential Agreements
In the event that the University wishes to enter into a Relevant Residential Agreement it shall
deliver a Request Notice to each of (1) Project Co (2) the Security Trustee and (3) the Facility
Agent by no later than CD - 30 and such Request Notice shall contain appropriate supporting
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evidence and data to support the request and the University's contentions that it has satisfied all
of the Applicable Tests.
67.5 Project Co response
Within 10 Working Days of receipt of the Request Notice Project Co shall:-
(a) refer any dispute it has (or of which it has been notified by the Security Trustee or the
Facility Agent) with the content of the Request Notice for determination by an Expert
in accordance with the Liaison and Disputes Resolution Procedure; or
(b) agree in writing (or take no action to dispute) the contents of the Request Notice in
which case, subject to the provisions of Clause 67.6 the University shall be entitled to
enter into the Relevant Residential Agreement on the Proposed Contract Terms at any
time during the following three months.
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67.6 Security Trustee Response
Notwithstanding that the Applicable Tests have been met the University shall not be entitled to
enter into a Relevant Residential Agreement where it has received a notificationFollowing
Period Decision Notice from the Security Trustee of an Event of Default pursuant to Clause
15.4.34.1 of the Senior Lenders' Direct Agreement and such Event of DefaultFollowing
Period Decision Notice is still subsisting at the Contract Date.
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Part 13 - The Operational Phase
68. PROVISION OF SERVICES
Project Co has covenanted pursuant to the terms of the Long Term UnderleaseUnderleases to
provide the Services to the University and the Services shall be provided by Project Co in
accordance with the provisions of Schedule 11 (the Services).
69. ALLOCATION OF ROOMS
The parties shall comply with the Administration and Allocation Policy set out in Schedule 12
(Administration Arrangements and Allocation Policy).
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Part 14 – Miscellaneous Provisions
70. AGENCY
70.1 No Delegation
No provision of any Project Document shall be construed as a delegation by the University of

any of its duties or authority to Project Co.
70.2 No Agency
Save as otherwise provided in any Project Document, neither Party shall be or be deemed to
be an agent of the other Party and neither Party shall hold itself out as having authority or
power to bind the other Party in any way.
70.3 Independent Contractor
Project Co shall at all times be an independent contractor and nothing in any Project
Document shall be construed as creating any partnership or joint venture between the
University and Project Co or any relationship of employer and employee between the
University and Project Co or any employee of Project Co.
70.4 Project Co Responsibilities
As between the Parties Project Co shall be responsible for the acts, defaults, omissions and
neglect of its Contracting Associates and the directors, officers, agents, employees or servants
or any of them in relation to the Project Documents, as fully as if they were the acts, defaults,
omissions or neglect of Project Co.
70.5 The University's Responsibilities
As between the Parties, the University shall be responsible for the acts, defaults, omissions
and neglect of its Third Party Suppliers, its invitees/visitors (other than Project Co or any of
the Contracting Associates) but not for the avoidance of doubt any Occupier and the directors,
officers, agents, employees or servants of any of them in relation to the Project and/or the
Project Documents as fully as if they were the acts, defaults, omissions or neglect of the
University.
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70.6 Project Co's knowledge
Without limitation to its actual knowledge, Project Co shall, for all purposes of the Project
Documents, be deemed to have such knowledge in respect of the Project as it held (or as ought
reasonably to be held) by any Contracting Associate.
71. WAIVER
Failure by either Party at any time to enforce any provision of any Project Document or to
require performance by the other Party of any provision of the Project Documents shall not be
construed as a waiver of such provision and shall not affect the validity of such Project
Document or any part thereof or the right of the relevant Party to enforce any provision in
accordance with its terms. The rights or remedies of either Party may be waived only if such
waiver is recorded in writing.
72. COUNTERPARTS
Each Project Document may be executed in one or more counterparts. Any single counterpart
or a set of counterparts executed, in either case, by all the parties thereto shall constitute a full
and original Project Document for all purposes.
73. SEVERABILITY
If any condition, Clause or provision or any Project Document not being of a fundamental
nature is held to be illegal or unenforceable then the Parties shall consult at the time in good
faith with the mutual aim of agreeing a revised condition, Clause or provision which is not or
will not be illegal or unenforceable and which will have the same overall economic effect and
pending such revision coming into effect, the validity or enforceability of the remainder of
such Project Document shall not be affected thereby.
74. WARRANTIES AND DISCLAIMERS
The Parties shall comply with the provisions of Schedule 24 (Warranties).
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75. LIAISON AND DISPUTES RESOLUTION
75.1 Liaison Procedure
Save where this Agreement expressly provides to the contrary, where any matter falls to be
determined by agreement between the Parties or a Dispute arises between the Parties, the
Parties shall endeavour to agree the matter or resolve the Dispute in accordance with the
Liaison Procedure.
75.2 Disputes Resolution Procedure
Where either Party elects to do so (whether during the course of the Liaison Procedure or
otherwise), that Party may refer a matter or Dispute for resolution in accordance with the
Dispute Resolution Procedure.
76. ADVISERS AND REPRESENTATIVES
76.1 The University's Contract Manager
76.1.1 Except as previously notified by the University's Contract Manager to Project Co in

writing, Project Co shall be entitled to treat any act of:
(a) the University's Contract Manager; and
(b) any person notified to Project Co in writing by any such person
as being expressly authorised by the University and Project Co shall not be required
to determine whether an express authority has in fact been given. For the avoidance
of doubt, no such notification may be given retrospectively.
76.1.2 Project Co shall not be entitled to rely upon any discretion exercised by the
University or any waiver of any rights granted by the University, unless that
discretion is exercised by or waiver granted by the person or persons referred to in
Clause 76.1.1.
76.1.3 The appointment of the University's Contract Manager shall be without prejudice to
the University's right to appoint any person or entity as its agent to perform any act.
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76.2 Project Co's Representatives
76.2.1 Project Co's Project Director shall be entitled to exercise all the rights of Project Co
under the Project Documents. Except as previously notified by Project Co to the
University in writing the University shall be entitled to treat any person notified to
the University in writing by Project Co as being expressly authorised and the
University shall not be required to determine whether any express authority has in
fact been given.
76.2.2 The appointment of Project Co's Project Director shall be without prejudice to
Project Co's right to appoint any person or entity as its agent to perform any act,
exercise any function or for any other purpose.
76.3 Change of Representatives
76.3.1 The University may, at any time and from time to time by written notice to Project
Co, change the designated officer appointed as the University's Contract Manager.
Any such notice shall specify the date on which such change shall have effect,
which date shall be such as will not cause serious inconvenience to Project Co in
the execution of its obligations or rights hereunder.
76.3.2 Project Co may, at any time and from time to time by written notice to the
University change Project Co's Contract Manager. Any such notice shall specify
the date on which such change shall have effect which date shall be such as will not
cause serious inconvenience to the University in the execution of its obligations or
rights hereunder.
77. QUALITY ASSURANCE
77.1 Quality Management Systems
Project Co shall procure that each of the Sub-Contractors will be subject to a quality
management system (the "Quality Management System") which complies with:
77.1.1 ISO9000 (or such other quality standard as may replace or supersede the same or,
in the absence of a replacement or a superseding quality standard, such other
quality standard as the Parties may agree acting reasonably);
77.1.2 the Output Specification; and
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77.1.3 Good Industry Practice.
77.2 Approval of Quality Management Plans
Project Co shall not later than the Phase 1 Works Completion Date (in respect of Phase 1
Works), Phase 2 Works Completion Date (in respect of Phase 2 Works), Phase 3 Works
Completion Date (in respect of Phase 3 Works) and if applicable the Phase 4 Works
Completion Date (in respect of Phase 4 Works) submit a Quality Management Plan
concerning those phases to the University for approval (which shall not be unreasonably
withheld).
Notwithstanding the submission of such Quality Management Plans to the University, and the
University's approval thereof, no such approval shall in any way reduce or otherwise affect the
obligations or liabilities of Project Co as regards the suitability of or any defect in the Quality
Management Plans or any inconsistency or lack of co-ordination between any Quality
Management Plans.
77.3 Development of Quality Management Plans
Project Co will procure that the Sub-Contractors shall have sole responsibility for the
continuing development of their Quality Management Plans, which Project Co may submit to
the University for review and comment from time to time paying due regard to the
University's comments, provided that no such review shall in any way reduce or otherwise
affect the obligations or liabilities of Project Co as regards the suitability of or any defect in
the Quality Management Plans or any inconsistency or lack of co-ordination between any
Quality Management Plans.
77.4 Additional Information
Notwithstanding any other provision of this Clause 77 Project Co shall provide to the
University such information as it may reasonably require to demonstrate compliance with this
Clause 77.
77.5 Management
Project Co shall procure that each Sub-Contractor shall appoint an individual responsible for
quality. The identity of this individual, and the definition of their role will be defined in the
Quality Management Plan. This individual will ensure:
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77.5.1 the effective management of the Quality Management System;
77.5.2 that the audits of the Quality Management Plan take place at regular intervals; and
77.5.3 that the Quality Management System is reviewed to ensure continued suitability
and effectiveness.
77.6 Quality Monitoring
Project Co shall procure that, in relation to each Quality Management System:
77.6.1 internal audits shall be carried out by personnel independent of those having direct
responsibility for the activity being audited;
77.6.2 the Quality Management System will be subject to independent third party audits in
accordance with the Sub-Contractor's own registration process;
77.6.3 each Sub-Contractor will ensure that quality and compliance issues are reported to
Project Co in the regular reports; and
77.6.4 each Sub-Contractor will permit the University to accompany third parties carrying
out Scheduled audits of the Quality Management System at appropriate intervals of
12 months or as the parties may otherwise agree from time to time.
78. NOTICES
78.1 Address
Except as otherwise stated, all notices or other communications required in connection with
any Project Document shall be in writing and sent by hand, by first class prepaid post or by
facsimile transmission to the relevant address or facsimile number set out below or to such
other address or facsimile number as either Party may notify to the other in writing by not less
than five Working Days' prior notice.
The University
Address : University House, The University of Lancaster LA1 4GW

Fax : 0154 592025
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Attention : The Director of Resources
Project Co
Address : Jarvis UPP 24 Britton Street4th Floor Weston House, 246 High Holborn,
London WC1V 7EX
Fax : 020 7017 80017280 4401
Attention : The Managing Director Jarvis UPP DivisionCompany Secretary
78.2 Effective Receipt
78.2.1 Subject to Clause 78.3 and 78.4, a letter delivered by hand shall be effective when
it is delivered to the addressee.
78.2.2 Subject to Clause 78.4, a letter sent by first class prepaid post shall be deemed
received on the second Working Day after it is put in the post.
78.2.3 Subject to Clauses 78.3 and 78.4, a facsimile transmission shall be effective upon
completion of transmission.
78.3 Timing
A notice or other communication received on a day which is not a Working Day or after 5pm
on any Working Day shall be deemed to be received on the next Working Day.
78.4 Notices to the University
All notices and other communications required to be served on the University shall only be
deemed to be sufficiently served if they are addressed to or marked for the attention of the
Director of Resources.
78.5 Notices to Project Co
All notices and other communications required to be served on Project Co shall only be
deemed to be sufficiently served if they are addressed to or marked for the attention of the
Managing Director Jarvis UPP Division.
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79. CONSENTS AND APPROVALS
79.1 Approvals
Save where any of the Project Documents provides that any approval may be given or
withheld in either party's absolute discretion, each Party shall act in good faith and deal in a
timely and diligent manner in relation to the giving of any approval under any Project
Document.
79.2 Project Co's Obligations
Subject as otherwise expressly provided in the Project Documents, neither the giving of any
approval, knowledge of the terms of any agreement or document nor the review of any
document or course of action by or on behalf of the University shall relieve Project Co of any
of its obligations or duties under the Project Documents.
80. VAT
80.1 Save where expressly stated in the Project Documents and subject to Clause 80.5 and 80.6
below all amounts stated to be payable by either Party under the Project Documents shall be
inclusive of any VAT properly payable in respect of the supplies to which they relate.
80.2 Each Party shall pay to the other Party any VAT properly payable hereunder in respect of any
supply made to it under any Project Document, provided that it shall first have received from
the other Party a valid value added tax invoice in respect of that supply which complies with
the requirements of Part III VAT (General) Regulations 1995.
80.3 Project Co agrees that it will, on the reasonable request of the University and on reasonable
notice, provide the University with such information as it may request regarding the VAT
chargeable on the services provided by Project Co under this Agreement.
80.4 Subject to the provisions of Clause 80.6, neither party shall take any action which will
adversely affect the treatment of payments made under the Project Documents in relation to
Value Added Tax, unless required to so by Legislation after complying with the provisions of
this Clause 80.
80.5 Effect of a VAT Change in Legislation
80.5.1 Either Party may notify the other of any proposed VAT Change in Legislation.
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80.5.2 Following such notification, the Parties will enter into good faith negotiations to
consider and assess what other effect the VAT Change in Legislation will have on
the Project Documents and the Parties' obligations under them with a view to
agreeing what (if any) amendments might be made to the Project Documents
(including, without limitation, increasing the Modelled Rental Income, increasing
the Nominated Room Rate or an extension to the Term or ceasing to use the
Accommodation for non student letting) in order to preserve the commercial
position of both Parties.
80.5.3 If the parties cannot reach agreement as referred to in Clause 80.5.2 within three
months from the start of their negotiations (or earlier if the VAT Change in
Legislation has occurred or is likely to occur before the end of the three months)
the parties shall refer the matter for determination by an Expert pursuant to the
Liaison and Disputes Resolution procedure and by way of supplement to the
directions to the expert determination pursuant to the Liaison and Disputes
Resolution Procedure, the Expert shall be required to consider and to carry out an
assessment of the effect of the VAT Change in Legislation or the proposed VAT
Change in Legislation on the Project Documents and the parties' legitimate
expectations under them, and the terms of reference of the Expert's appointment
shall be to propose a contractual solution which would, if implemented, have a
binding legal effect on Project Co and the University.
80.5.4 The Expert shall take full account of and determine the effect of the VAT Change
in Legislation on the Project Documents and the commercial position of both
parties and where possible determine a contractual solution to ensure the legal
effect of the Project Documents and preserve the commercial position of the parties
such that the parties respective commercial positions after the VAT Change in
Legislation would not be materially worse than their respective positions
immediately prior to the VAT Change in Legislation.
80.5.5 The Expert shall be required to communicate his reasoned assessment to the parties
and, where the Expert has determined there is a contractual solution, details of the
solution and the Expert's proposals for its implementation.
80.5.6 Following the decision of the Expert if either:
(a) a Party (acting reasonably) rejects the contractual solution proposed by the
Expert pursuant to Clause 80.5.5; or
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(b) the Expert determines there is no Contractual Solution
then either Party shall be entitled to terminate this Agreement and the Project
Documents pursuant to Clause 49.9 (Events entitling either party to terminate).
80.6 VAT liability of supplies under Underleases
80.6.1 The University has issued to Project Co a valid certificate (complying with the
requirements of HM Revenue & Customs & Excise VAT Notice 708) in respect of
the buildings within the Project Co Accommodation comprised within Phase 1,
Phase 2 and Phase 3 confirming that the buildings are intended for a use solely for
a relevant residential purpose in accordance with Note 12(b) to Group 5 of
Schedule 8 of the VATA 1994.
80.6.2 Project Co confirms that it has elected or will prior to the grant of the relevant Long
Term Underleases elect to waive exemption from VAT pursuant to Paragraph 2
Schedule 10 Value Added Tax Act 1994 in respect of those parts of the buildings
within the Project Co Accommodation comprised within Phase 1, Phase 2 and
Phase 3 which are not referred to in, or covered by the certificate issued by the
University pursuant to Clause 80.6.1.80.6.1 and other than in respect of County.
80.6.3 The Parties acknowledge that the grant by Project Co to the University of the Long
Term Underleases of those parts of the buildings in respect of which the University
has issued a certificate as descrieddescribed in Clause 80.6.280.6.1 and which are
treated by HM Revenue & Customs & Excise as intended for use solely for a
relevant residential purpose (within the meaning of Note 4 1 Group 5 Schedule 8
Value Added Tax Act 1994) shall be a zero-rated supply for VAT purposes to the
extent that such grant is in each case made for consideration in the form of the first
payment of rent due under the relevant Long Term Underlease (within the meaning
of Note 14(b) to Group 5 of Schedule 8 of the VATA 1994) and an exempt supply
to the extent that such grant is in each case made for consideration in the form of
subsequent payments of rent due under the relevant Long Term Underlease.
80.6.4 The Parties acknowledge that the grant by Project Co to the University of the Long
Term Underleases of those parts of the Buildings comprised within Phase 1,
Phase 2 and Phase 3 in respect of which the University has not issued a certificate
as described in Clause 80.6.280.6.1 or which are not treated from time to time by
HM Revenue & Customs & Excise as intended for use solely for a relevant
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residential purpose (within the meaning of Note 4 Group 5 Schedule 8 Value
Added Tax Act 1994) (the Non RRP Areas) shall in each case be a standard rated
supply by Project Co for VAT purposes, and accordingly:-
(a) all amounts payable by the University in respect of supplies by Project Co

of Non RRP Areas shall be exclusive of VAT; and
(b) the University shall pay to Project Co an amount equal to the VAT properly
chargeable in respect of such part of the University Accommodation
Charge as is properly apportioned to the Non RRP Areas.
80.6.5 The partiesUniversity will, as soon as reasonably practicable following request

by Project Co (and in any event no later than one week prior to the grant of
the first Long Term Underlease in respect of Phase 4) issue to Project Co valid
certificates (complying with the requirements of HM Revenue & Customs
VAT Notice 708) in respect of the Accommodation comprising Grizedale and
County Field (the "Relevant Phase 4 Residential Areas"), confirming that the
buildings comprised within such Relevant Phase 4 Residential Areas are
intended for use solely for a relevant residential purpose in accordance with
Note 12(b) to Group 5 of Schedule 8 of VATA 1994
80.6.6 The Parties acknowledge that the grant by Project Co to the University of the
Long Term Underleases of the Relevant Phase 4 Residential Areas shall be a
zero-rated supply for VAT purposes to the extent that such grant is in each
case made for consideration in the form of the first payment of rent due under
the relevant Long Term Underlease (within the meaning of Note 14(b) to
Group 5 of Schedule 8 of the VATA 1994) and an exempt supply to the extent
that such grant is in each case made for consideration in the form of
subsequent payments of rent due under the relevant Long Term Underlease.
80.6.7 The Parties agree that 0.77% of the aggregate Accommodation Charge for Phases
1-3 payable as rent pursuant to the Underleases is attributable to the Non RRP
Areas.
80.6.8 Subject to the provisions of clause 80.6.2 the parties agree that neither party
will elect to waive exemption from VAT pursuant to paragraph 2 schedule 10
Value Added Tax Act 1994 in respect of any part of the Site without the prior
written approval of the other party
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81. ENTIRE AGREEMENT
Save as provided in this Agreement, the Project Documents constitute the whole agreement
and understanding of the Parties as to the Project. The Project Documents supersede all prior
representations, communications, negotiations and understandings concerning the subject
matter of this Agreement or the other Project documents and (except as expressly referred to
in the Project Documents) there are no prior or contemporaneous agreements between the
parties in respect of the Project. No Party has relied on any representation or warranty except
as expressly set out in this Agreement. Provided that this Clause 81 shall not exclude any
liability which either Party would otherwise have to the other in respect of any statements
made fraudulently by such party prior to the date of this Agreement.
82. SURVIVAL
82.1 The provisions of Clauses 2, 11, 12, 13, 15, 21, 24, 25, 75, 78, 85, 87, Part E, Part F and
paragraph 1.4.4 of Part B of Schedule 20, shall survive the termination of this Agreement and
shall continue in full force and effect, along with any other Clauses, Schedules and
Appendices of or to the Project Documents necessary to give effect to them. In addition, any
other provisions of this Agreement or the Project Documents which by their nature or
implication (including in respect of any accrued rights and liabilities) is required to survive
termination or expiry of this Agreement shall survive such termination or expiry.
83. INTEREST ON LATE PAYMENT
Save where otherwise specifically provided where any payment or sum of money due from
Project Co to the University or from the University to Project Co under any provision of this
Agreement is not paid on the due date for payment set out in this Agreement it shall bear
interest thereon at the Senior Debt No Default Rate from the due date (whether before or after
any judgement) until actual payment.
84. THIRD PARTY RIGHTS
The parties to this Agreement do not intend that any of its provisions shall be enforceable by
virtue of the Contracts (Rights of Third parties) Act 1999 by any person not a party to it.
85. GOVERNING LAW AND JURISDICTION
85.1 This Agreement shall be considered a contract made in England and Wales and shall be
subject to the laws of England and Wales.
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85.2 Subject to the provisions of the Liaison and Disputes Resolution Procedure, both Parties agree
that the courts of England and Wales shall have exclusive jurisdiction to hear and settle any
action, suit, proceeding or dispute in connection with this Agreement and irrevocably submit
to the jurisdiction of those courts.
86. SET OFF
In addition and without prejudice to any rights of set-off the University may have as a matter
of law or otherwise, whenever any sum or sums of money shall be recoverable from or
payable by Project Co under this Agreement or any other Project Documents, the same may be
set off against, by applying the same in or towards satisfaction of, any sum then due and
payable to the Project Co under this Agreement or under any other Project Document so that
the sum due to the Project Co shall be the net amount after the exercise of any such set-off.
87. EXCLUSIVE REMEDIES
87.1 Neither party shall be entitled to recover compensation under this Agreement from the other
Party more than once in respect of the same loss, damage, cost or expense.
87.2 Save to the extent expressly included in:
(a) any deduction or adjustment or other variation of any element taken into account in
calculating the University Accommodation Charge and the compensation amounts set
out in Schedule 20 or otherwise as expressly provided in this Agreement or the Project
Documents; or
(b) any payment which Project Co (whether by indemnity or otherwise) is by the express
terms of this Agreement or the other Project Documents liable to pay to the
University; or
(c) any payment (including Compensation Events) which the University (whether by
indemnity or otherwise) is by the express terms of this Agreement or the Project
Documents liable to pay to Project Co,
where either Party is liable to the other in respect of claims or losses, Project Co shall not be
liable to the University and the University shall not be liable to Project Co for any loss of
profit, loss of revenue, loss of use, loss of contract, loss of goodwill or consequential or other
financial loss suffered by the relevant Party making the claim or suffering the loss.
- 198 -
87.3 Without prejudice to the right of either Party to seek interlocutory or other non-financial relief
(including, without limitation, injunctions and orders for specific performance) and save as
expressly provided in this Agreement or in the Project Documents, neither Party shall have
any liability in respect of any claims by or losses suffered by the other at common law in
relation to this Agreement or any of the Project Documents.
87.4 Where in this Agreement or in the Project Documents there has been a breach by the
University for which a specific remedy is available (which shall include without limitation
breaches of the University's Obligations under Schedules 11, 12 and Clause 66.1)to the Project
Company this shall not be treated as an University Default Event for the purposes of this
Agreement.
88. NO AVOIDANCE OF LIABILITY
Where in this Agreement the University is or would otherwise be liable to pay any amount by
way of compensation, or to grant any other relief or entitlement to Project Co, the University
shall not be entitled to withhold, reduce or avoid any such payment, relief or entitlement to
Project Co in reliance only on the fact that any amount, relief or entitlement which is or may
become due from Project Co to the Building Contractor or to the Hard FM Contractor as a
result of the circumstances giving rise to the University's aforesaid liability is conditional on
the receipt of payment, relief or entitlement by Project Co from the University.
89. EXEMPT CHARITY
The University declares that the premises to be demised to it pursuant to the Underleases will
be held by the University by or in trust for a charity and that charity is an exempt charity.
IN WITNESS whereof this Agreement has been executed and delivered as a deed on the date first
above written
- 199 -

Lancaster University-UPP Master Agreement

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CONFORMED COPY

Second Amendment and Restatement

UPP (Lancaster) Limited

relating to a Master Agreement for the provision

1. DEFINITIONS AND INTERPRETATION ........................................................................ 1

1. Building Contract Phase 4

2. Building Contract Warranty Phase 4

3. Replacement Hard FM Contract

THE PARTIES AGREE AS FOLLOWS:

1. DEFINITIONS AND INTERPRETATION

In this deed unless the context otherwise requires:

"Amendments" means the additions variations deletions and amendments to the

"Deed of Variation of Headleases" means the deed of variation of the SW Campus

"Further Revised Master Agreement" means the Revised Master Agreement as

"Phase 4 Building Contractor" means Norwest Holst Limited

"Phase 4 Building Contractor Warranty" means the warranty to be entered into

"Replacement Hard FM Contract" means the Hard FM Contract to be entered into

"Replacement Hard FM Contractor" means UPP Residential Services Limited

1.2 Original Master Agreement Definitions

(b) References in this deed to the "Master Agreement" shall be deemed to be

1.4 Deemed to Take Effect

2. AMENDMENTS TO THE REVISED MASTER AGREEMENT AND THE DEEDS OF

2.4 In consideration of the payment of by the Project Co to the University (receipt

4. REVISED MASTER AGREEMENT OTHERWISE IN FULL FORCE

5. THE CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

7. REFINANCING AND NEW FINANCING AGREEMENTS

8. THE PHASE 4 BUILDING CONTRACT

9. THE REPLACEMENT HARD FM CONTRACT

10. BASE CASE FINANCIAL MODEL AND BASE CASE REQUIREMENTS

(a) the Phase 4 Works;

(c) the Refinancing

11. NO DELAY EVENTS OR BREACHES

12. WORKS TO CONSTITUTE PART OF PHASE 4 WORKS

13. PHASE 4 WORKS CUT-OFF DATE EXTENDED

Further Revised Master Agreement

The common seal of UPP )

DEFINITIONS AND CONSTRUCTION........................................................................................... 1

ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster

ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster

ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster

ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster

Agreed Form Documents

3. Building Contract Guarantee

5. Cartmel Short Term Underlease

8. Core Accommodation Headleases

9. Core Accommodation Underleases

10. Phase 1 Lease Not used

11. Phase 1 Underlease

12. Phase 2 Lease

13. Phase 2 Underleases

14. Deeds of Surrender Long Term Leases

15. County Lease

16. County Short Term Underlease

17. County Underlease

18. Employer's Agent's Appointment

18A. Employer's Agent's Appointment Phase 4

19. Finance Agreements

19A. Finance Agreements Phase 4

20. Furness Lease

21. Furness Short Term Underlease

22. Furness Underlease

23. Fylde Lease

24. Fylde Short Term Underlease

ABS\#4387929 v1 - Conformed Copy - Master Agreement - University of Lancaster